EXHIBIT 10.2
to S-11
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CONTRIBUTION AND LOAN AGREEMENT
dated as of ___________, 2003
by and between
DELPHI CORPORATION
as Borrower
and
DELPHI PROPERTIES, INC.
as Lender
Stock Issuance: Up to 12,420,000 shares
Membership Interest Purchase: 1% of Delphi Properties Holdings, LLC
Maximum Loan Amount: $1,000,000,000.00
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TABLE OF CONTENTS
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ARTICLE I PARTICULAR TERMS, DEFINITIONS AND RULES OF CONSTRUCTION.................................................1
SECTION 1.01. Definitions................................................................................1
SECTION 1.02. Rules of Construction......................................................................5
ARTICLE II CONTRIBUTION AND LOAN..................................................................................6
SECTION 2.01. The Contribution...........................................................................6
SECTION 2.02. The Loan, Generally........................................................................6
SECTION 2.03. Purpose....................................................................................6
SECTION 2.04. Procedure for Advance......................................................................6
SECTION 2.05. Notes......................................................................................7
SECTION 2.06. Payments and Distributions.................................................................7
SECTION 2.07. Interest...................................................................................7
SECTION 2.08. Voluntary Prepayments......................................................................7
ARTICLE III YIELD MAINTENANCE ETC.................................................................................8
SECTION 3.01. Additional Costs and Other Effects of Regulatory Changes; Taxes............................8
ARTICLE IV CONDITIONS PRECEDENT...................................................................................8
SECTION 4.01. Conditions Precedent to the Stock Issuance and the Initial Advance.........................8
SECTION 4.02. Conditions Precedent to Future Advances...................................................10
ARTICLE V REPRESENTATIONS AND WARRANTIES.........................................................................11
SECTION 5.01. Due Formation, Power and Authority........................................................11
SECTION 5.02. Legally Enforceable Agreements............................................................11
SECTION 5.03. Financial Statements......................................................................11
SECTION 5.04. Compliance With Laws......................................................................11
SECTION 5.05. Litigation................................................................................12
SECTION 5.06. No Conflicts or Defaults..................................................................12
(i)
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SECTION 5.07. Solvency..................................................................................12
SECTION 5.08. Governmental Regulation...................................................................12
SECTION 5.09. Insurance.................................................................................12
SECTION 5.10. No Event of Default.......................................................................12
SECTION 5.11. Separate Tax and Zoning Lot...............................................................12
SECTION 5.12. Creation of Liens.........................................................................13
SECTION 5.13. Appraisals................................................................................13
SECTION 5.14. Loan to Value Ratio.......................................................................13
ARTICLE VI COVENANTS OF BORROWER.................................................................................13
SECTION 6.01. Compliance with Laws; Payment of Taxes....................................................13
SECTION 6.02. Maintenance of Existence..................................................................13
SECTION 6.03. Continuing Accuracy of Representations and Warranties.....................................13
SECTION 6.04. Covenants, Restrictions and Easements.....................................................14
SECTION 6.05. Inspection and Cooperation................................................................14
SECTION 6.06. Payment of Costs..........................................................................14
SECTION 6.07. Brokers...................................................................................14
SECTION 6.08. Insurance.................................................................................14
SECTION 6.09. Condemnation Awards and Insurance Proceeds................................................14
SECTION 6.10. Filing and Recording of Documents.........................................................15
SECTION 6.11. Premises Documents........................................................................15
SECTION 6.12. Reporting Requirements....................................................................16
SECTION 6.13. Secondary Financing.......................................................................16
ARTICLE VII EVENTS OF DEFAULT AND REMEDIES.......................................................................16
SECTION 7.01. Events of Default.........................................................................16
SECTION 7.02. Remedies of Lender........................................................................18
SECTION 7.03. Remedies Cumulative.......................................................................19
(ii)
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SECTION 7.04. Lender's Rights Concerning Application of Amounts Collected...............................19
ARTICLE VIII GENERAL CONDITIONS AND PROVISIONS...................................................................19
SECTION 8.01. Documentation, Etc. Satisfactory..........................................................19
SECTION 8.02. Notices...................................................................................19
SECTION 8.03. Amendments and Waivers....................................................................20
SECTION 8.04. Successors and Assigns....................................................................20
SECTION 8.05. Severability..............................................................................20
SECTION 8.06. Non-Waiver; Remedies Cumulative...........................................................20
SECTION 8.07. Certain Waivers...........................................................................20
SECTION 8.08. Expenses..................................................................................21
SECTION 8.09. General Indemnification...................................................................21
SECTION 8.10. Environmental Indemnification.............................................................22
SECTION 8.11. Partial Release of Mortgaged Property.....................................................23
SECTION 8.12. Counterparts..............................................................................23
SECTION 8.13. Governing Law; Jurisdiction...............................................................23
SECTION 8.14. Integration...............................................................................24
SECTION 8.15. Gross-Up for Taxes........................................................................24
SECTION 8.16. Assignment of Mortgages and Notes.........................................................24
SCHEDULES
IA Contributed Notes
IB Membership Interest Purchase Notes
II Initial Advance Notes
III Future Advance Notes
EXHIBITS
A Form of Mortgage Note
B Form of Mortgage
(iii)
CONTRIBUTION AND LOAN AGREEMENT (this "Agreement") dated as of
________________, 2003 by and between DELPHI CORPORATION, a Delaware corporation
("Borrower"), and DELPHI PROPERTIES, INC., a Maryland corporation ("Lender").
WHEREAS, Borrower has agreed to issue one or more Notes (as
defined below) as identified on the attached SCHEDULE IA to Lender in exchange
for up to 12,420,000 shares of the common stock of Lender (the "Stock
Issuance");
WHEREAS, Borrower has agreed to issue one or more Notes as
identified on the attached SCHEDULE IB to Lender in exchange for a one percent
(1%) membership interest (the "Membership Interest Purchase") in Delphi
Properties Holdings, LLC ("Holdings") ;
WHEREAS, Borrower shall issue the Notes identified on the
attached SCHEDULE II to Lender to evidence the initial loan made pursuant to the
terms of this Agreement in the principal amount of [$_______________] (the
"Initial Loan Amount");
WHEREAS, Borrower has agreed to issue additional Notes
identified on the attached SCHEDULE III (as such schedule may be amended or
modified from time to time) to Lender to evidence Future Advances (as defined
below) made pursuant to the terms of this Agreement;
WHEREAS, the maximum principal amount that may at any time be
advanced under, and evidenced by the Notes issued pursuant to, this Agreement is
$1,000,000,000.00 (the "Maximum Loan Amount"); and
WHEREAS, Borrower desires that Lender consummate the Stock
Issuance, the Membership Interest Purchase and the Loan (as defined below; the
Loan, the Membership Interest Purchase and the Stock Issuance are referred to
herein collectively as the "Transactions"), and Lender is prepared to enter the
Transactions on the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual promises and
agreements herein contained, Borrower and Lender hereby agree as follows:
ARTICLE I
PARTICULAR TERMS, DEFINITIONS AND RULES OF CONSTRUCTION
SECTION 1.01. Definitions. The following terms, as used
herein, shall have the following meanings:
"Additional Costs" -- Any costs, losses or expenses actually
incurred by Lender which it reasonably determines are attributable to its
entering into or maintaining the Transactions or any reduction in any amount
receivable by any Lender under the Transaction Documents or the Notes.
"Affiliate" -- As to any Person, any other Person that,
directly or indirectly, controls, is controlled by or is under common control
with such Person or is a director or officer of such Person. For purposes of
this definition, the term "control" (including the terms "controlling",
"controlled by" and "under common control with") of a Person means the direct or
indirect possession of the power to vote 5% or more of the equity interests of
such Person or to direct or cause the direction of the management and policies
of such Person, whether through the ownership of equity interests, by contract
or otherwise.
"Appraisals" -- Has the meaning specified in Section
4.01(e)(3).
"Bankruptcy Code" -- Chapter 11 of the U.S. Bankruptcy Code
(11 U.S.C.ss.ss. 101 et seq.)
"Business Day" -- Any day on which commercial banks are not
authorized or required to close in New York City or Troy, Michigan.
"Code" -- The Internal Revenue Code of 1986.
"Dollars" and "$" -- Lawful money of the United States.
"Employee Benefit Plan" -- Any employee benefit or other plan
established or maintained, or to which contributions have been made, by Borrower
or any Mortgagor.
"Environmental Action" -- Any action, suit, demand, demand
letter, claim, notice of non-compliance or violation, notice of liability or
potential liability, investigation, proceeding, consent order or consent
agreement relating in any way to any Environmental Law, any Environmental Permit
or Hazardous Material or arising from alleged injury or threat to health, safety
or the environment, including, without limitation, (a) by any governmental or
regulatory authority for enforcement, cleanup, removal, response, remedial or
other actions or damages and (b) by any governmental or regulatory authority or
third party for damages, contribution, indemnification, cost recovery,
compensation or injunctive relief.
"Environmental Law" -- Any federal, state, local or foreign
statute, law, ordinance, rule, regulation, code, order, writ, judgment,
injunction, decree or judicial or agency interpretation, policy or guidance
relating to pollution or protection of the environment, health, safety or
natural resources, including, without limitation, those relating to the use,
handling, transportation, treatment, storage, disposal, release or discharge of
Hazardous Materials.
"Environmental Permit" -- Any permit, approval, identification
number, license or other authorization required under any Environmental Law.
"ERISA" -- The Employee Retirement Income Security Act of
1974, including the rules and regulations promulgated thereunder.
"ERISA Affiliate" -- Any corporation which is a member of the
same controlled group of corporations (within the meaning of Section 414(b) of
the Code) as Borrower and/or any Mortgagor, or any trade or business which is
under common control (within the meaning of Section 414(c) of the Code) with
Borrower and/or any Mortgagor, or, solely for purposes of Section 412 of the
Code, any organization which is required to be treated as a single employer with
Borrower and/or any Mortgagor under Section 414(m) or 414(o) of the Code.
"Event of Default" -- Has the meaning specified in Section
7.01.
"Excess Proceeds" - Has the meaning specified in Section
6.09(b).
"Financial Statements" -- Statements of the assets,
liabilities (direct or contingent), income, expenses and cash flow of Borrower
and Mortgagors, prepared on a consolidated basis in accordance with generally
accepted accounting principles in the United States as in effect from time to
time and consistently applied. The accounting method used in the preparation of
financial statements submitted to Lender prior to the date hereof is hereby
deemed acceptable.
"Future Advance" -- Has the meaning specified in Section
2.04(b).
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"Governmental Authorities" -- The United States, and, as to
each of the Premises, the respective state in which such Premises are located
and any political subdivision, agency, department, commission, board, bureau or
instrumentality of any of them, including any local authorities, which exercises
jurisdiction over Borrower, each Mortgagor, any of the Premises or any of the
Improvements.
"Greater Loan to Value Ratio" has the meaning specified in
Section 6.09(a).
"Hazardous Materials" -- (a) Petroleum or petroleum products,
by-products or breakdown products, radioactive materials, asbestos-containing
materials, polychlorinated biphenyls and radon gas and (b) any other chemicals,
materials or substances designated, classified or regulated as hazardous or
toxic or as a pollutant or contaminant under any Environmental Law.
"Holdings" -- Has the meaning specified in the recitals.
"Improvements" -- Has the meaning given to such term in the
Mortgages.
"Indemnified Party" -- Has the meaning specified in Section
8.10.
"Initial Advance" -- Has the meaning specified in Section
2.04.
"Initial Loan Amount" - Has the meaning specified in the
recitals.
"Interest Rate" -- A rate of 7.75% per annum.
"Law" -- Any federal, state or local law, statute, rule,
regulation, ordinance, order, decree, directive, requirement, code, notice of
violation or rule of common law, now or hereafter in effect, and in each case as
amended, and any judicial or administrative interpretation thereof by a
Governmental Authority, including any judicial or administrative order,
determination, consent decree or judgment.
"Lender's Counsel" - Shearman & Sterling, 599 Lexington
Avenue, New York, New York 10022, or such other Person as is designated by
Lender.
"Lender's Office" -- Lender's Office as set forth on its
signature page of this Agreement, or such other address in the United States as
Lender may designate by notice to Borrower.
"Lien" -- Any lien, security interest or other charge or
encumbrance of any kind, or any other type of preferential arrangement,
including, without limitation, the lien or retained security title of a
conditional vendor and any easement, right of way or other encumbrance on title
to real property.
"Loan" -- The loan, in an aggregate principal amount equal to
the Initial Loan Amount plus the principal amount of any Future Advances, to be
made pursuant to this Agreement.
"Loan to Value Ratio" -- The ratio of the then outstanding
principal balance of the Note or Notes secured by the applicable Mortgage (as
indicated on SCHEDULES I, II and III) to the fair market value of the applicable
Mortgaged Property based on an appraisal of such Mortgaged Property, in form and
substance reasonably satisfactory to Lender. As used herein, "fair market value"
shall mean the most probable price the applicable Mortgaged Property should
bring in a competitive and open market under all conditions requisite to a fair
sale.
"Losses" -- has the meaning specified in Section 8.09(a).
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"Material Adverse Effect" -- Means a material adverse effect
on (a) the business, condition (financial or otherwise), operations,
performance, properties or prospects of Borrower and its consolidated
subsidiaries, taken as a whole, (b) the rights and remedies of Lender under any
Transaction Document, (c) the ability of Borrower or Mortgagors to perform their
respective obligations under any Transaction Document to which any of them is or
is to be a party where such inability to perform would have a material adverse
effect upon the aggregate underlying security for the Loan, or (d) any
Mortgagor's claim of title to any of the Premises resulting in the loss or
forfeiture of title to such Premises.
"Maturity Date" -- [______________, 2033].
"Maximum Loan Amount" -- has the meaning specified in the
recitals.
"Membership Interest Purchase" -- has the meaning specified in
the recitals.
"Mortgage" -- Any mortgage (or deed of trust), security
agreement, assignment of leases and rents and fixture filing made to or for the
benefit of Lender, to secure the payment and performance of Borrower's
obligations hereunder, under the Notes and otherwise in respect of the
Transactions, substantially in the form of EXHIBIT B attached hereto or in such
other form as may be mutually agreed upon by Lender and Borrower, each acting in
its reasonable discretion, in each case with such changes thereto as may be made
based on local laws or customary local mortgage or deed of trust practices.
"Mortgaged Property" -- The Premises and other property
constituting the "Mortgaged Property", as such term is defined in each Mortgage.
"Mortgagor" -- has the meaning ascribed to it in Section
4.01(e)(7).
"Multiemployer Plan" -- Any plan defined as such in Section
3(37) of ERISA.
"Net Proceeds" -- (i) The net amount of all proceeds of any
insurance policies insuring against loss or damage to the Mortgaged Property or
(ii) all awards, damages, remunerations, reimbursements, settlements or
compensation made by any Governmental Authority pertaining to any condemnation
or other taking (or any purchase in lieu thereof) of all or any portion of the
Mortgaged Property.
"Non-Excluded Taxes" -- Has the meaning specified in Section
8.15.
"Note"; "Notes" -- Have the respective meanings specified in
Section 2.05.
"Partial Release" -- Has the meaning specified in Section
8.11.
"Pension Plan" -- Any employee pension benefit plan within the
meaning of Section 3(2) of ERISA with respect to which Borrower, any Mortgagor
or any ERISA Affiliate at any relevant time has liability or an obligation to
contribute.
"Permitted Liens" -- (a) Liens for taxes, judgments,
assessments and governmental charges or levies not yet due and payable or which
are not reasonably likely to result in a Material Adverse Effect; (b) Liens
imposed by law, such as materialmen's, mechanics', carriers', workmen's and
repairmen's Liens and other similar Liens arising in the ordinary course of
business where such liens have not been the subject of a final non-appealable
foreclosure action and are not, individually or in the aggregate, reasonably
likely to result in a Material Adverse Effect; (c) pledges or deposits to secure
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obligations under workers' compensation laws or similar legislation or to secure
public or statutory obligations; and (d) leases, occupancy agreements, licenses,
easements, rights of way and other encumbrances on title to real property that
do not render title to the property encumbered thereby unmarketable or
materially adversely affect the use of such property for its present or
then-existing purposes.
"Person" -- An individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust, unincorporated
association, joint venture or other entity of whatever nature.
"Premises" -- The real property described on Exhibit A to the
Mortgages and each located as indicated on SCHEDULES I, II and III hereto, upon
all or part of which the Improvements are located.
"Premises Document" -- All reciprocal easement or operating
agreements, declarations, development agreements, developer's or utility
agreements, and any similar such agreements or declarations now or hereafter
affecting any of the Premises or any part thereof.
"Principal Amount" -- At any time, the aggregate outstanding
principal amount of the Notes from time to time outstanding pursuant to the
terms of this Agreement.
"Regulatory Change" -- With respect to any Lender, any change
after the date hereof in federal, state or foreign laws or regulations or the
adoption or making after such date of any interpretations, directives or
requests applying to a class of banks including such Lender under any federal,
state or foreign laws or regulations (whether or not having the force of law) by
any court or governmental or monetary authority charged with the interpretation
or administration thereof.
"Related Mortgagor" -- Any Mortgagor that is included in the
Financial Statements of Borrower. All of the initial Mortgagors are Related
Mortgagors.
"Released Mortgaged Property" -- Has the meaning specified in
Section 8.11.
"Remedy" -- Has the meaning specified in Section 8.06.
"Restoration" -- The repair and restoration of the Mortgaged
Property after a casualty occurrence or condemnation.
"Stock Issuance" - Has the meaning specified in the recitals.
"Transaction Documents" -- This Agreement, the Notes, the
Mortgages (and, if required by Lender, Uniform Commercial Code financing
statements in respect of the Mortgaged Property and any other collateral given
as security for the Transactions), and any other documents which evidence or
secure the Transactions.
"Transactions" - Has the meaning specified in the recitals.
"United States" and "U.S." -- The United States of America.
SECTION 1.02. Rules of Construction. Except as expressly
provided otherwise, when used in this Agreement (i) "or" is not exclusive, (ii)
"hereunder", "herein", "hereof" and the like refer to this Agreement as a whole,
(iii) "Article", "Section", "Schedule" and "Exhibit" refer to Articles,
Sections,
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Schedules and Exhibits of this Agreement, (iv) terms defined in the singular
shall have a correlative meaning when used in the plural and vice versa, (v) a
reference to a Law includes any amendment, modification or supplement to, or
replacement of, such Law and (vi) a reference to a document shall mean such
document as the same may be amended, modified or supplemented from time to time
in accordance with its terms. The cover page and the Exhibits and Schedules
annexed hereto are incorporated as a part of this Agreement with the same effect
as if set forth in the body hereof. Any table of contents and all captions and
headings herein are for convenience only and shall not affect the interpretation
or construction hereof.
ARTICLE II
CONTRIBUTION, MEMBERSHIP INTEREST PURCHASE AND LOAN
SECTION 2.01. The Contribution and Membership Interest
Purchase. Subject to the terms and conditions of this Agreement, including
satisfaction of the conditions of Section 4.01 hereof, Borrower shall (a) issue
to Lender the Notes secured by the Mortgages indicated on SCHEDULE IA in
exchange for [________] shares of the common stock of Lender and (b) issue to
Lender the Notes secured by the Mortgages indicated on SCHEDULE IB in exchange
for a one percent (1%) membership interest in Holdings, in each case upon the
satisfaction of the conditions of Section 4.01 hereof.
SECTION 2.02. The Loan, Generally. Subject to the terms and
conditions of this Agreement, Lender agrees to advance the Loan. The Loan shall
be advanced in multiple disbursements with the first disbursement being made in
a principal amount equal to the Initial Advance upon Borrower's issuance of the
Notes secured by the Mortgages indicated on SCHEDULE II and upon the
satisfaction of the other conditions set forth in Section 4.01. Subsequent
disbursements shall be made upon Borrower's satisfaction of the conditions set
forth in Section 4.02.
SECTION 2.03. Purpose. Borrower shall use the proceeds of the
Loan for general corporate purposes. In no event shall proceeds of the Loan be
used for any illegal purpose.
SECTION 2.04. Procedure for Advance.
(a) The initial advance hereunder shall be [$________________]
(the "Initial Advance") and shall be evidenced by the Notes and secured
by the Mortgages indicated on SCHEDULE II and shall be made upon the
satisfaction of the conditions of Section 4.01 hereof and Lender's
receipt of a request for the advance of proceeds of the Loan.
(b) Each future advance (each such future advance, a "Future
Advance") hereunder shall be evidenced by one or more new Notes and
secured by one or more new Mortgages as indicated on SCHEDULE III and
shall be made upon the satisfaction of the conditions of Section 4.02
hereof and Lender's receipt of a request for the advance of proceeds of
the Loan. SCHEDULE III may be amended or modified from time to time as
mutually agreed upon by Lender and Borrower, each acting in its
reasonable discretion.
(c) On the date set for each such advance, Lender shall,
subject to the conditions of this Agreement, make the amount to be
advanced by it on such day available in immediately available funds for
the account of Borrower by crediting an account of Borrower designated
by Borrower in its request for advance.
SECTION 2.05. Notes. The Transactions shall be evidenced by
Mortgage Notes issued by Borrower in the form of EXHIBIT A, duly completed and
executed by Borrower and payable to
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Lender (such Mortgage Notes, as the same may hereafter be amended, modified,
extended, severed, assigned, substituted, renewed or restated from time to time
(including, without limitation, any replacement notes issued pursuant to this
Section 2.05), each, a "Note" and collectively, the "Notes"). The Notes shall
mature, and all outstanding principal and other sums thereunder shall be paid in
full, on the Maturity Date, as the same may be accelerated or extended in
accordance with the provisions of this Agreement.
In case of any loss, theft, destruction or mutilation of any
Note, Borrower shall, upon its receipt of an affidavit of an officer of Lender
as to such loss, theft, destruction or mutilation and an appropriate
indemnification, execute and deliver a replacement Note to Lender in the same
principal amount and otherwise of like tenor as the lost, stolen, destroyed or
mutilated Note.
SECTION 2.06. Payments and Distributions. Borrower shall make
each payment under this Agreement and under the Notes on the date when due to
Lender at Lender's Office by check or wire transfer. Payments by Borrower
hereunder or under the Notes or other Transaction Documents shall be made
without setoff or counterclaim.
Except to the extent otherwise provided in this Agreement,
whenever any payment to be made under this Agreement or under the Notes is due
on any day other than a Business Day, such payment shall be made on the next
succeeding Business Day, and such extension of time shall in such case be
included in the computation of the payment of interest and, if applicable, fees,
as the case may be.
SECTION 2.07. Interest. Interest shall be computed on an
actual/360-day basis (i.e., interest for each day during which any portion of
the Principal Amount is bearing interest at a particular interest rate per annum
shall be computed at such rate divided by 360).
Borrower shall pay to Lender interest on the Principal Amount
at the Interest Rate. Such interest on the Principal Amount shall be payable on
each [Quarterly Dividend Payment Date] of each year (or, if any such day is not
a Business Day, the next succeeding Business Day) until the Notes are repaid in
full.
SECTION 2.08. Voluntary Prepayments. Borrower may prepay all
or any portion of the principal amount of any of the Notes, without premium or
penalty; provided, however, that each prepayment under this Section shall
include all interest accrued on the amount of principal prepaid through the date
of prepayment. If, pursuant to this Section 2.08, Borrower prepays the entire
principal amount of any Note together with all interest accrued thereon and all
other sums that may be payable in respect thereof, Lender shall, at Borrower's
request and at the cost and expense of Borrower, release the Mortgaged Property
and related collateral securing such Note (but Lender shall not be obligated to
release any Mortgaged Property or other collateral securing any other Note). In
such event, Lender shall promptly execute and deliver to Borrower, at Borrower's
cost and expense, any documents required by law in order to release the
applicable Mortgaged Property and related collateral.
ARTICLE III
YIELD MAINTENANCE ETC.
SECTION 3.01. Additional Costs and Other Effects of Regulatory
Changes; Taxes. Borrower shall pay directly to Lender, promptly upon demand,
such amounts as are reasonably necessary to compensate Lender for Additional
Costs resulting from any Regulatory Change which without duplication (i)
subjects Lender to any tax, duty or other charge with respect to the
Transactions or the Notes, or changes the basis of taxation of any amounts
payable to Lender under the Transactions or the
7
Notes (other than taxes imposed on the overall net income of Lender or of
Lender's Office by the jurisdiction in which Lender's Office is located and
franchise taxes imposed in lieu thereof), (ii) imposes, modifies or deems
applicable any reserve, special deposit or similar requirements relating to any
extensions of credit or other assets of, or any deposits with or other
liabilities of, Lender, (iii) imposes on Lender any other condition affecting
the Transactions or the Notes, or any of such extensions of credit or
liabilities or (iv) imposes any capital adequacy requirements on Lender by
virtue of the Transactions or the Notes. Lender shall notify Borrower of any
event occurring after the date hereof which would entitle it to compensation
pursuant to this paragraph as promptly as practicable after it obtains knowledge
thereof and determines to request such compensation and, at Borrower's sole cost
and expense, shall take such steps as Borrower reasonably requests in order to
avoid the imposition of such costs.
Determinations by each Lender of the existence or effect of
any Regulatory Change on its costs of entering or maintaining the Transactions
or amounts receivable by it in respect thereof, and of the additional amounts
required to compensate Lender in respect of Additional Costs, shall be
conclusive, so long as made on a reasonable basis.
ARTICLE IV
CONDITIONS PRECEDENT
SECTION 4.01. Conditions Precedent to the Stock Issuance, the
Membership Interest Purchase and the Initial Advance. Lender shall not be
obligated to consummate the Stock Issuance, the Membership Interest Purchase or
make the Initial Advance until the following conditions shall have been
satisfied:
(a) Lender shall have received a request for the advance of
proceeds in accordance with Section 2.04 hereof;
(b) There shall exist no Event of Default, and no Event of
Default would result from the Stock Issuance, the Membership Interest
Purchase or the making of the Loan;
(c) The representations and warranties made to Lender herein,
in the other Transaction Documents and in any other document,
certificate or statement executed or delivered to Lender in connection
with the Transactions shall be true and correct in all material
respects on the date of this Agreement;
(d) The Premises shall not have been materially injured or
damaged by fire or other casualty after the date of the applicable
Appraisal and on or before the date of this Agreement; and
(e) Lender shall have received and approved each of the
following:
(1) Transaction Documents. This Agreement and each of
the other Transaction Documents, duly executed by the parties
thereto, and, where applicable, duly acknowledged and in
proper form for recording or filing, as the case may be, and
evidence of the proper submission of all necessary or
desirable recordings and filings;
(2) Financial Statements. Borrower's most recent
Financial Statements;
(3) Appraisals. Appraisals of the Premises in form
and substance reasonably satisfactory to Lender (the
"Appraisals");
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(4) Insurance Policies. Originals or copies of all
policies or certificates of insurance evidencing the insurance
coverages required under Section 6.08 hereof;
(5) Title Reports. Title searches or commitments for
policies of title insurance prepared by a title company
reasonably satisfactory to Lender for each of the Premises in
form and substance reasonably satisfactory to Lender;
(6) Flood Searches. Flood hazard determinations
indicating that none of the Premises are located in an area
identified by the Secretary of the United States Department of
Housing and Urban Development or by any applicable federal
agency as a Flood Hazard Area;
(7) Organizational Documents. If Borrower, the
mortgagor or grantor under any Mortgage (if different from
Borrower (each, a "Mortgagor", and collectively "Mortgagors"))
or any general partner or member of any of them is a
corporation, current copies of the following documents with
respect to each (unless otherwise indicated):
(i) a good-standing certificate from the
jurisdiction of its incorporation and, as to Borrower
or Mortgagor under any Mortgage only, from the
jurisdiction in which the applicable Premises are
located,
(ii) evidence that the consummation of the
transactions contemplated hereby and the execution,
delivery and performance of the Transaction Documents
has been duly authorized, and
(iii) a certificate of the corporate
secretary as to the incumbency of the officers
executing any of the documents required hereby,
and, if Borrower, any Mortgagor or any general partner or
member of any of them is a partnership, venture, limited
liability company or trust:
(iv) the entity's organizational agreement
and all amendments and attachments thereto, certified
by a general partner, venturer, member or trustee to
be true and complete,
(v) any certificates filed or required to be
filed by the entity in the jurisdictions of its
formation and where the Premises are located in order
for it to do business in those jurisdictions, and
(vi) evidence of the authorization of the
consummation of the transactions contemplated hereby
and the execution, delivery and performance of the
Transaction Documents and any other documents to be
executed, delivered and performed by said entity
(including any substitute or replacement notes to be
executed and delivered pursuant to the terms hereof),
and including any required consents by partners,
venturers, members, trustees or beneficiaries; and
(8) Additional Documentation. Such other approvals,
opinions or documents as Lender may reasonably request.
SECTION 4.02. Conditions Precedent to Future Advances. Lender
shall not be obligated to make any Future Advance until the following conditions
shall have been satisfied:
9
(a) Lender shall have received a request for the advance of
proceeds delivered in accordance with Section 2.04 hereof;
(b) All conditions of Section 4.01 shall be satisfied as of
the date of such Future Advance with respect to (i) the Premises
mortgaged by the applicable Mortgagor to secure such Future Advance as
indicated on SCHEDULE III and (ii) the applicable Mortgagor;
(c) There shall exist no Event of Default, and no Event of
Default would result from the making of the advance;
(d) The Premises mortgaged to secure such Future Advance shall
not have been materially injured or damaged by fire or other casualty
after the date of the applicable Appraisal and on or before the date of
the Future Advance;
(e) Receipt by Lender of evidence of the submission for
recordation of the Mortgages securing the applicable Future Advance as
indicated on SCHEDULE III and payment of all applicable recording taxes
and fees in connection therewith;
(f) No trustee, receiver or liquidator of the Premises
mortgaged under the applicable Mortgage to secure such Future Advance
or any part thereof, or of the applicable Mortgagor shall have been
appointed by order of any court of competent jurisdiction;
(g) The Mortgagor executing any Mortgage securing such Future
Advance shall not have filed a petition in bankruptcy or for an
arrangement or for reorganization pursuant to the Bankruptcy Code or
any similar federal or state law relating to bankruptcy, insolvency or
other relief for debtors unless such petition shall have been
discharged, stayed or dismissed as of the date of such Future Advance;
(h) The Mortgagor executing any Mortgage securing such Future
Advance shall not (1) by decree of a court of competent jurisdiction,
have been adjudicated bankrupt or declared insolvent, (2) have made an
assignment for the benefit of creditors which has not been discharged,
(3) have admitted in writing its inability to pay its debts generally
as they become due, or (4) have consented to the appointment of a
receiver or receivers of all or any part of its property; and
(i) No creditors of the Mortgagor executing any Mortgage
securing such Future Advance shall have filed a petition in bankruptcy
against such Mortgagor or for reorganization of such Mortgagor pursuant
to the Bankruptcy Code or any similar federal or state law relating to
bankruptcy, insolvency or other relief for debtors, unless such
petition shall have been discharged, stayed or dismissed as of the date
of such Future Advance.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
Borrower represents and warrants to Lender that:
SECTION 5.01. Due Formation, Power and Authority. If it, any
Mortgagor or any general partner or member of any of them is a corporation,
partnership, venture, limited liability company or trust, each such entity is
duly organized, validly existing and in good standing under the Laws of the
jurisdiction of its formation, is qualified to do business and is in good
standing in the jurisdiction in which
10
the Premises are located (if required), and has full power and authority to
consummate the transactions contemplated hereby and to execute, deliver and
perform this Agreement and any Transaction Document to which it is a party.
SECTION 5.02. Legally Enforceable Agreements. Each Transaction
Document to which Borrower or any Mortgagor is a party is a legal, valid and
binding obligation of such party, enforceable against Borrower or such
Mortgagor, as the case may be, in accordance with its terms, except to the
extent that such enforcement may be limited by (a) applicable bankruptcy,
insolvency and other similar Laws affecting creditors' rights generally, (b)
principles of equity or (c) judicial discretion.
SECTION 5.03. Financial Statements. Financial Statements have
been heretofore delivered to Lender which are true, correct and current in all
material respects and which fairly present the respective financial conditions
of the subjects thereof as of the respective dates thereof; no material adverse
change has occurred in the financial conditions reflected therein between the
respective dates thereof and the date of this Agreement and no borrowings (other
than the Loan) which might give rise to a Lien or claim against the Mortgaged
Property or proceeds of the Loan have been made by Borrower or others between
the dates thereof and the date of this Agreement.
SECTION 5.04. Compliance With Laws. Borrower and Mortgagors
are in compliance with, and the transactions contemplated hereby and the other
Transaction Documents do not and will not violate any provision of, or require
any filing, registration, consent or approval under, any Law presently in effect
having applicability to Borrower or Mortgagors and Borrower has filed or caused
to be filed all tax returns (federal, state and local) required to be filed and
paid all taxes, assessments and governmental charges due and payable, except
where such violation or the failure to make any such filing or registration or
to obtain the applicable consent or approval or make payment is not reasonably
likely to result in a Material Adverse Effect.
SECTION 5.05. Litigation. Except as disclosed in Borrower's
periodic filings with the Securities and Exchange Commission, to the best
knowledge of Borrower, there are no actions, suits or proceedings pending or, to
the actual knowledge of Borrower, threatened against or affecting Borrower,
Mortgagors, the Premises, the validity or enforceability of the Mortgages or the
priority of the lien thereof at law or in equity, before or by any Governmental
Authorities except actions, suits or proceedings which are fully covered by
insurance or would, if adversely determined, not likely have a Material Adverse
Effect. To Borrower's knowledge, no default exists with respect to any order,
writ, injunction, decree or demand of any court or Governmental Authorities
where such default is reasonably likely to result in a Material Adverse Effect.
SECTION 5.06. No Conflicts or Defaults. The consummation of
the transactions contemplated hereby and the performance hereof and of the other
Transaction Documents have not resulted and will not result in any breach of, or
constitute a default under, any mortgage, deed of trust, lease, bank loan or
credit agreement, corporate charter, by-laws, partnership agreement or other
instrument to which Borrower or any Mortgagor is a party or by which either of
them may be bound.
SECTION 5.07. Solvency. Borrower and Mortgagors are, and upon
consummation of the transactions contemplated by this Agreement, the other
Transaction Documents and any other related documents, will be, solvent.
SECTION 5.08. Governmental Regulation. Borrower and Mortgagors
are not subject to regulation under the Investment Company Act of 1940 or any
Law limiting Borrower's ability to incur indebtedness for money borrowed as
contemplated hereby.
11
SECTION 5.09. Insurance. Borrower has or caused to be in
force, and has paid or caused to be paid the premiums in respect of, all of the
insurance required by this Agreement.
SECTION 5.10. No Event of Default. There exists no Event of
Default.
SECTION 5.11. Separate Tax and Zoning Lot. To Borrower's
knowledge, each of the Premises listed on SCHEDULES I, II and III consists of
one or more distinct parcels for purposes of zoning and of taxes, assessments
and impositions (public or private), and are not otherwise considered as part of
a larger single lot for purposes of zoning or of taxes, assessments or
impositions (public or private) except where the failure to so consist of one or
more distinct parcels would not reasonably be expected to have a Material
Adverse Effect.
SECTION 5.12. Creation of Liens. Borrower has entered into no
contract or arrangement of any kind the performance of which by the other party
thereto would give rise to a Lien, other than a Permitted Lien, on the Mortgaged
Property prior to the Mortgages.
SECTION 5.13. Appraisals. The Premises valued in the
Appraisals and indicated on SCHEDULES I, II and III attached hereto are the same
Premises whose legal descriptions are attached as Exhibit A to the applicable
Mortgages.
SECTION 5.14. Loan to Value Ratio. The Loan to Value Ratio for
each of the Premises listed on SCHEDULES I, II and III attached hereto shall not
materially exceed 1:1 as of the date of the applicable advance of loan proceeds.
ARTICLE VI
COVENANTS OF BORROWER
Borrower covenants and agrees that it will promptly:
SECTION 6.01. Compliance with Laws; Payment of Taxes. Comply
or cause compliance with all Laws applicable to it, Mortgagors or the Mortgaged
Property, or any part thereof, such compliance to include, without limitation,
paying before the same becomes delinquent, all taxes, assessments and
governmental charges imposed on it, Mortgagors or the Mortgaged Property, or any
part thereof, and promptly furnish Lender with any notices from Governmental
Authorities and any claims of violation of any Laws, except where the failure to
comply is not reasonably likely to result in a Material Adverse Effect.
SECTION 6.02. Maintenance of Existence. Preserve and keep in
full force and effect its existence, franchises, rights and privileges as a
business or stock corporation under the laws of the State of Delaware, and cause
each Related Mortgagor to preserve and keep in full force and effect its
existence, franchises, rights and privileges as a business or stock corporation,
partnership, limited liability company, trust or other entity under the laws of
such Related Mortgagor's jurisdiction of formation or existence, except in the
event of a merger, consolidation or sale of substantially all of the assets of
Borrower or any Related Mortgagor, where the surviving entity or the transferee
assumes the obligations of the Borrower or applicable Related Mortgagor under
the Transaction Documents to which the applicable Related Mortgagor is a party.
SECTION 6.03. Continuing Accuracy of Representations and
Warranties. Undertake commercially reasonable efforts in order to cause all of
the representations and warranties made to Lender
12
herein and in the other Transaction Documents to remain materially true and
correct to the extent reasonably practical as of the date of each Future
Advance.
SECTION 6.04. Covenants, Restrictions and Easements. Use
commercially reasonable efforts to comply or cause each Mortgagor to comply with
all restrictions, covenants and easements affecting the Premises or the
Improvements and cause the satisfaction of all conditions thereof, except where
the failure to comply is not reasonably likely to result in a Material Adverse
Effect.
SECTION 6.05. Inspection and Cooperation. Permit or cause
permission to be granted to Lender and its representatives to enter upon the
Premises and inspect the Improvements at reasonable times on reasonable prior
notice.
SECTION 6.06. Payment of Costs. Pay or cause to be paid all
costs and expenses required by this Agreement and the satisfaction of the
conditions hereof, including, without limitation:
(a) all document and stamp taxes, recording and filing
expenses and fees and commissions lawfully due to brokers in connection
with the transactions contemplated hereby, and
(b) any taxes, insurance premiums, Liens, security interests
or other claims or charges against the Premises or Improvements.
SECTION 6.07. Brokers. Indemnify Lender against claims of
brokers arising by reason of the execution hereof or the consummation of the
transactions contemplated hereby. Notwithstanding the foregoing, Lender hereby
represents that no broker was engaged by Lender in bringing about the
Transactions.
SECTION 6.08. Insurance. Provide and maintain or cause to be
provided and maintained in full force and effect the following insurance
coverages: (a) property "all risk" insurance covering the Mortgaged Property;
and (b) such other insurance as may be required by applicable Law (including
worker's compensation and employer's liability insurance) or as Lender may
reasonably require from time to time. Any policy of property insurance required
by clause (a) above shall be in an amount not less than the full replacement
cost of the Improvements and any personal property covered by such policy, shall
contain a "full replacement cost" endorsement, shall insure against flood loss
risk if the Land is located in a Flood Hazard Area, and shall name Lender as an
additional insured or mortgagee and as a "loss payee". All insurance policies
shall be in form and substance and issued by insurers reasonably satisfactory to
Lender, and shall contain such deductibles and such endorsements as Lender may
reasonably require. Upon request by Lender from time to time, Borrower shall
deliver to Lender certificates of insurance evidencing such insurance coverage.
Notwithstanding the foregoing, Borrower shall have the right to enter into a
program of self-insurance for the purpose of satisfying Borrower's or any
Related Mortgagor's obligations hereunder and under the Mortgagor.
SECTION 6.09. Condemnation Awards and Insurance Proceeds.
(a) Following a casualty occurrence or condemnation affecting
all or any portion of the Mortgaged Property, Net Proceeds shall be
payable to Borrower (or the applicable Mortgagor); provided, however,
that (i) if Borrower does not diligently prosecute or cause the
diligent prosecution of the Restoration or does not apply the entire
Net Proceeds to the cost of such Restoration and (ii) the Loan to Value
Ratio immediately following the Restoration is materially greater than
the greater of (A) the Loan to Value Ratio as of the date immediately
preceding the casualty or condemnation or (B) the Loan to Value Ratio
as of the date of the Initial Advance or
13
Future Advance evidenced by the Note or Notes secured by such Mortgaged
Property (such greater value, the "Greater Loan to Value Ratio"), then
the provisions of Sections 6.09(b) and (c) below shall apply.
(b) If the entire Net Proceeds are not applied to the cost of
the Restoration and the Loan to Value Ratio immediately following the
Restoration shall be materially greater than the Greater Loan to Value
Ratio, Borrower shall pay or cause to be paid to Lender and Lender
shall apply to the principal amount of the Note or Notes secured by
such Mortgaged Property that portion of Net Proceeds not applied to the
costs of Restoration (the "Excess Proceeds") as is sufficient to cause
the Loan to Value Ratio immediately following the Restoration to equal
no more than 105% of the Greater Loan to Value Ratio; provided,
however, that in no event shall Borrower or the applicable Mortgagor be
obligated to pay an amount in excess of the Excess Proceeds pursuant to
this Section 6.09(b). Any remaining Net Proceeds shall be retained by
Borrower.
(c) If Borrower does not intend to undertake the Restoration,
Borrower shall pay or cause to be paid to Lender and Lender shall apply
to the principal amount of the Note or Notes secured by such Mortgaged
Property that portion of the Net Proceeds as is sufficient to cause the
Loan to Value Ratio immediately following the casualty occurrence or
condemnation to equal no more than 105% of the Greater Loan to Value
Ratio. Any remaining Net Proceeds shall be retained by Borrower.
SECTION 6.10. Filing and Recording of Documents. Upon the
execution and delivery hereof and from time to time thereafter, cause the
Mortgages and any security instrument creating or evidencing the lien of the
Mortgages upon the Mortgaged Property and each instrument of further assurance
to be filed, registered or recorded in such manner and in such places as may be
required by any Law in order to publish notice of and fully to protect the lien
of the Mortgages upon, and the interest of Lender in, the Mortgaged Property.
(a) Pay or cause to be paid all filing, registration or
recording fees, and all expenses incident to the execution and acknowledgment
of the Mortgages, any security instrument with respect to the Mortgaged Property
(including, without limitation, any Uniform Commercial Code financing statements
and any filings necessary or desirable from time to time in connection with the
continuation or renewal thereof), and any instrument of further assurance, and
any expenses (including reasonable attorneys' fees and disbursements) incurred
by Lender in connection with the Transactions, and pay all federal, state,
county and municipal stamp taxes and other taxes, duties, imposts, assessments
and charges arising out of or in connection with the execution and delivery of
the Notes, the Mortgages, any security instrument with respect to the Mortgaged
Property or any instrument of further assurance.
SECTION 6.11. Premises Documents. Use commercially reasonable
efforts (as determined by Borrower in good faith) to do all things (and direct
each Mortgagor to do all things) necessary to cause the due compliance and
faithful performance by the other parties to the Premises Documents with and of
all material obligations and agreements by such other parties to be complied
with and performed thereunder, except where the failure of such compliance or
performance is not reasonably likely to result in a Material Adverse Effect.
SECTION 6.12. Reporting Requirements. Furnish to Lender:
(1) Annual Financial Statements. As soon as available and in
any event within one hundred twenty (120) days after the end of the
fiscal year of Borrower, Financial Statements, as of the end of and for
such fiscal year, certified by the principal financial or accounting
officer of Borrower as being materially true, correct and current in
all material respects, in reasonable
14
detail, stating in comparative form the respective figures for the
preceding fiscal year and compiled by a firm of certified public
accountants reasonably satisfactory to Lender.
(2) Notices of Defaults. As soon as possible and in any event
within ten (10) days after Borrower or any Mortgagor becomes aware of
the occurrence of an Event of Default, a written notice setting forth
the details of such Event of Default and the action that has been taken
or is proposed to be taken with respect thereto; and
(3) General Information. Promptly, such other information
respecting the condition or operations, financial or otherwise, of
Borrower, Mortgagors or the Premises as Lender may from time to time
reasonably request.
SECTION 6.13. Secondary Financing. So long as any of the Notes
shall remain unpaid or any other amount is owing by Borrower to Lender under any
Transaction Document or otherwise in respect of the Transactions, not enter into
any junior financing arrangement with any Person with the Mortgaged Property or
any portion thereof as collateral therefor, unless (a) such junior financing is
expressly subordinated to the Transaction Documents and the Person providing
such junior financing enters into an intercreditor agreement in form and
substance reasonably satisfactory to Lender and (b) the ratio of (i) the sum of
the aggregate outstanding principal balance of the Notes and all junior
financing arrangements secured by the Mortgaged Property or any portion thereof
to (ii) the aggregate value of the Mortgaged Property based on appraisals of the
Mortgaged Property, each in form and substance reasonably satisfactory to
Lender, does not exceed one to one.
ARTICLE VII
EVENTS OF DEFAULT AND REMEDIES
SECTION 7.01. Events of Default. The occurrence of any one or
more of the following events shall constitute an Event of Default (each, an
"Event of Default"):
(a) if default shall be made in the payment of any principal,
interest, fees or other sums under the Notes, the Mortgages or this
Agreement, in any such case, when and as the same shall become due and
payable, whether at maturity or by acceleration or as part of any
payment or prepayment or otherwise, in each case, as herein or in the
Notes or the Mortgages provided, and such default shall have continued
for a period of five (5) Business Days following written notice thereof
to Borrower by Lender; or
(b) if default shall be made in the due observance or
performance of any other covenant, condition or agreement in this
Agreement, the Notes, the Mortgages or in any other document executed
or delivered in connection with the Transactions, and such default
shall have continued for a period of one hundred twenty (120) days
after notice thereof shall have been given to Borrower by Lender, or,
in the case of such other documents, such shorter grace period, if any,
as may be provided for therein or, if such default is not reasonably
susceptible of cure during such one hundred twenty (120) days or such
shorter grace period, so long as Borrower diligently proceeds to cure
such default, such longer period as may be reasonably required to cure
such default so long as such longer period is not reasonably likely to
result in a Material Adverse Effect; or
(c) if any representation or warranty made by Borrower herein
shall be materially incorrect when made and reasonably likely to result
in a Material Adverse Effect, or if any other representation or
warranty made to Lender in the Transaction Documents shall be
materially
15
incorrect in any material respect when made and reasonably likely to
result in a Material Adverse Effect; or
(d) if by order of a court of competent jurisdiction, a
trustee, receiver or liquidator of Borrower shall be appointed and such
order shall not be discharged or dismissed within ninety (90) days
after such appointment or, so long as Borrower diligently proceeds to
effect such discharge or dismissal, such longer period as may be
reasonably required to effect such discharge or dismissal; or
(e) if Borrower shall file a petition in bankruptcy or for an
arrangement or for reorganization pursuant to the Bankruptcy Code or
any similar federal or state law, or if, by decree of a court of
competent jurisdiction, Borrower shall be adjudicated bankrupt, or be
declared insolvent, or shall make an assignment for the benefit of
creditors, or shall admit in writing its inability to pay its debts
generally as they become due, or shall consent to the appointment of a
receiver or receivers of all or any part of its property; or
(f) if any of the creditors of Borrower shall file a petition
in bankruptcy against Borrower or for reorganization of Borrower
pursuant to the Bankruptcy Code or any similar federal or state law,
and if such petition shall not be discharged, stayed or dismissed
within one hundred twenty (120) days after the date on which such
petition was filed or, so long as Borrower diligently proceeds to
effect such discharge or dismissal, such longer period as may be
reasonably required to effect such discharge or dismissal; or
(g) if a final judgment for the payment of money in excess of
the greater of (i) ten percent (10%) of the value of a Mortgaged
Property or (ii) $1,000,000.00 is filed as a Lien against such
Mortgaged Property (or any portion thereof) and Borrower shall not
discharge or cause the discharge of, or otherwise provide adequate
security (which may include affirmative title insurance coverage issued
by a duly licensed insurer selected by Borrower and reasonably
satisfactory to Lender) with respect to the final judgment within one
hundred twenty (120) days from the entry thereof, or shall not appeal
or cause the appeal therefrom or from the order, decree or process upon
which or pursuant to which said judgment was granted, based or entered,
and secure a stay of execution pending such appeal; or
(h) if there shall occur a default which is not cured within
the applicable grace period, if any, under any mortgage, deed of trust
or other security instrument covering all or part of the Mortgaged
Property regardless of whether any such mortgage, deed of trust or
other security instrument is prior or subordinate to the Mortgages but
only if such default or the consequences thereof are reasonably likely
to result in a Material Adverse Effect; it being further agreed by
Borrower that an Event of Default hereunder shall constitute an Event
of Default under the Mortgages; or
(i) if, except as permitted under the Transaction Documents,
Borrower or any Mortgagor shall transfer (or suffer or permit the
transfer) in any manner, either voluntarily or involuntarily, by
operation of law or otherwise, all or any portion of the Mortgaged
Property, or any interest or rights therein (including air or
development rights) without, in any such case, the prior consent of the
Lender (which consent shall not be unreasonably withheld, conditioned
or delayed). As used in this clause, "transfer" shall include, without
limitation, any sale or conveyance but shall not include leases or
other occupancy agreements or licenses, easements or similar
encumbrances comprising Permitted Liens. Notwithstanding the foregoing,
(A) Borrower or any Mortgagor may transfer a portion (but less than
all) of any Mortgaged Property, or any interest or right therein, free
and clear of the lien of the related Mortgage pursuant to, and subject
to compliance
16
with, Section 8.11 and (B) Borrower or any Mortgagor may transfer all
or any portion of a Mortgaged Property, or any interest or right
therein, if Borrower prepays the Note or Notes secured by such
Mortgaged Property pursuant to Section 2.08; or
(j) if Borrower or any Mortgagor shall encumber, or agree to
encumber, in any manner, either voluntarily or involuntarily, by
operation of law or otherwise, all or any portion of the Mortgaged
Property, or any interest or rights therein (including air or
development rights) where such encumbrance is reasonably likely to
result in a Material Adverse Effect, except for Permitted Liens or as
otherwise provided for in the Transaction Documents, without, in any
such case, the prior consent of Lender and Borrower or such Mortgagor
shall fail to bond over or discharge or otherwise provide adequate
assurance to Lender (which may include affirmative title insurance
coverage issued by a duly licensed insurer selected by Borrower and
reasonably satisfactory to Lender) with respect to the same within one
hundred twenty (120) days of receipt of notice thereof or such sooner
date if forfeiture is imminent. As used in this clause, "encumber"
shall include, without limitation, the placing or permitting the
placing of any mortgage, deed of trust, assignment of rents or other
security device. Notwithstanding the foregoing, if any Mortgagor
encumbers all or any portion of the Mortgaged Property, or any interest
or rights therein, such encumbrance shall not constitute an Event of
Default if Borrower prepays the principal amount of the Note or Notes
secured by such Mortgaged Property in accordance with Section 2.08 and
in an amount sufficient to cause the ratio of (A) the outstanding
principal amount of such Note or Notes immediately following such
prepayment to (B) the fair market value of the applicable Mortgaged
Property (taking into account the effect of such encumbrance) to equal
no more than 105% of the greater of (Y) the Loan to Value Ratio as of
the date immediately prior to such encumbrance or (Z) the Loan to Value
Ratio as of the date of the Initial Advance or Future Advance evidenced
by the Note or Notes secured by such Mortgaged Property.
SECTION 7.02. Remedies of Lender. Upon the occurrence of any
Event of Default, Lender may, without notice to or demand upon Borrower, which
are expressly waived by Borrower (except for notices or demands otherwise
required by applicable Law to the extent not effectively waived by Borrower),
exercise any one or more of the following Remedies:
(a) Lender, by notice to Borrower, may declare the entire
principal of the Notes then outstanding (if not then due and payable),
and all accrued and unpaid interest and other sums in respect thereof,
to be due and payable immediately, and upon any such declaration the
principal of the Notes and said accrued and unpaid interest and other
sums shall become and be immediately due and payable, anything herein
or in the Notes or the other Transaction Documents to the contrary
notwithstanding;
(b) Lender may perform any of the Borrower's obligations under
the Transaction Documents in such manner as Lender may determine; and
(c) Lender may proceed to protect, exercise and enforce any
and all other Remedies provided under the Transaction Documents or by
applicable Law.
SECTION 7.03. Remedies Cumulative. No remedy herein conferred
upon or reserved to Lender is intended to be exclusive of any other remedy or
remedies, and each and every such remedy shall be cumulative, and shall be in
addition to every other remedy given hereunder or now or hereafter existing at
law, in equity or by statute. No delay or omission of Lender to exercise any
right or power accruing upon any Event of Default shall impair any such right or
power, or shall be construed to be a waiver of any such Event of Default or any
acquiescence therein; and every power and remedy given hereby to Lender may be
exercised from time to time as often as may be deemed expedient by Lender.
17
Nothing herein or in the Notes or the other Transaction Documents shall affect
the obligation of Borrower to pay the principal of, and interest and other sums
on, the Notes and the other Transaction Documents in the manner and at the time
and place therein respectively expressed.
SECTION 7.04. Lender's Rights Concerning Application of
Amounts Collected. Notwithstanding anything to the contrary contained herein,
upon the occurrence of an Event of Default, Lender may apply, to the extent
permitted by law, any amount collected hereunder to principal, interest or any
other sum due under the Notes or the other Transaction Documents or otherwise in
respect of the Transactions in such order and amounts, and to such obligations,
as Lender shall elect in its sole and absolute discretion.
ARTICLE VIII
GENERAL CONDITIONS AND PROVISIONS
SECTION 8.01. Documentation, Etc. Satisfactory. All
documentation and proceedings reasonably deemed by Lender's Counsel to be
necessary or required in connection herewith and the documents relating hereto
shall be subject to the prior approval of Lender's Counsel as to form and
substance, such approval not to be unreasonably withheld. In addition, the
Persons responsible for the execution and delivery of, and signatories to, all
of such documentation, shall be acceptable to and subject to the approval of
Lender's Counsel. Lender's Counsel shall receive copies, certified if requested
by either of them, of all documents which they may reasonably require in
connection with the transactions contemplated hereby.
SECTION 8.02. Notices. Except as expressly provided otherwise,
all notices, demands, consents, approvals and statements required or permitted
hereunder shall be in writing and shall be deemed to have been sufficiently
given or served for all purposes when presented personally, three (3) days after
mailing by registered or certified mail, postage prepaid, or one (1) day after
delivery to a nationally recognized overnight courier service providing evidence
of the date of delivery, addressed to a party at its address on the signature
page hereof, or at such other address of which a party shall have notified the
party giving such notice in writing in accordance with the foregoing
requirements.
SECTION 8.03. Amendments and Waivers. No amendment or material
waiver of any provision of this Agreement or any other Transaction Document, nor
consent to any material departure by Borrower or any Mortgagor therefrom, shall
in any event be effective unless the same shall be in writing and signed by the
party against whom such amendment, waiver or consent is sought to be enforced,
and then such waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given. Without limiting the foregoing,
acceptance by Lender of any sum required to be paid pursuant hereto or any other
Transaction Document, after its due date, or in an amount less than the sum then
due, shall not constitute a waiver by Lender of its right to require prompt
payment when due of all other such sums or to declare a default or to exercise
such other rights provided herein or in the other Transaction Documents for such
late or reduced payment.
SECTION 8.04. Successors and Assigns. Except as herein
provided, this Agreement shall be binding upon and inure to the benefit of
Borrower and Lender and their respective heirs, personal representatives,
successors and permitted assigns. Notwithstanding the foregoing, Borrower may
not assign, transfer or set over to another, in whole or in part, all or any
part of its benefits, rights, duties and obligations hereunder, including, but
not limited to, performance of and compliance with conditions hereof and the
right to receive the proceeds of the Loan.
18
SECTION 8.05. Severability. The provisions hereof are intended
to be severable. Any provisions hereof, or the application thereof to any Person
or circumstance, which, for any reason, in whole or in part, is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof (or the remaining portions of such provision) or the
application thereof to any other Person or circumstance, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision (or portion thereof) or the application
thereof to any Person or circumstance in any other jurisdiction.
SECTION 8.06. Non-Waiver; Remedies Cumulative. No failure or
delay on Lender's part in exercising any right, remedy, power or privilege
hereunder or under any of the other Transaction Documents or provided by law
(hereinafter in this Section, each a "Remedy") shall operate as a waiver of any
such Remedy or shall be deemed to constitute Lender's acquiescence in any
default by Borrower or Mortgagors under any of said documents. A waiver by
Lender of any Remedy on any one occasion shall not be construed as a bar to any
other or future exercise thereof or of any other Remedy. The Remedies are
cumulative, may be exercised singly or concurrently and are not exclusive of any
other Remedies.
SECTION 8.07. Certain Waivers. Borrower hereby irrevocably and
unconditionally waives (i) promptness and diligence, (ii) notice of any actions
taken by Lender hereunder or under any other Transaction Document or any other
agreement or instrument relating hereto or thereto except to the extent
otherwise provided herein, (iii) all other notices, demands and protests, and
all other formalities of every kind in connection with the enforcement of
Borrower's obligations hereunder and under the other Transaction Documents, the
omission of or delay in which, but for the provisions of this Section, might
constitute grounds for relieving Borrower of any of its obligations hereunder or
under the other Transaction Documents, (iv) any requirement that Lender protect,
secure, perfect or insure any Lien on any collateral for the Transactions or
exhaust any right or take any action against Borrower, Mortgagors or any other
Person or against any collateral for the Transactions, (v) any right or claim of
right to cause a marshalling of Borrower's assets and (vi) all rights of
subrogation or contribution, whether arising by contract or operation of law or
otherwise by reason of payment by Borrower pursuant hereto or to any other
Transaction Document. EACH OF BORROWER AND LENDER FURTHER HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES, IN CONNECTION WITH ANY SUIT, ACTION OR PROCEEDING
BROUGHT BY OR ON BEHALF OF THE OTHER WITH RESPECT TO THIS AGREEMENT, THE NOTES
OR OTHERWISE IN RESPECT OF THE TRANSACTIONS, ANY AND EVERY RIGHT IT MAY HAVE TO
A TRIAL BY JURY.
SECTION 8.08. Expenses. Borrower covenants and agrees to pay
all reasonable costs, expenses and charges (including, without limitation, all
fees and charges of appraisers and the reasonable fees and disbursements of
Lender's Counsel) incurred by Lender in connection with (i) the preparation for
and consummation of the transactions contemplated hereby or for the performance
hereof and of the other Transaction Documents, and for any services which may be
required in addition to those normally and reasonably contemplated hereby; and
(ii) the enforcement hereof or of any or all of the other Transaction Documents.
In connection with the foregoing, Lender agrees, to the extent practicable, to
appoint a single counsel, selected by Lender in connection with the enforcement
of the Transaction Documents. If Borrower fails to pay promptly any costs,
charges or expense required to be paid by it as aforesaid, and Lender pays such
costs, charges or expenses, Borrower shall reimburse Lender, as appropriate, on
demand for the amounts so paid, together with interest thereon at the Interest
Rate.
SECTION 8.09. General Indemnification. Borrower agrees to
indemnify Lender and its directors, officers, employees and agents from, and
hold each of them harmless against:
19
(a) any and all claims, actions, suits, proceedings, costs,
expenses, losses, damages and liabilities of any kind, including in
tort, penalties and interest (collectively, "Losses") arising out of or
by reason of any investigation or litigation or other proceedings
(including any threatened investigation or litigation or other
proceedings) relating to any actual or proposed use by Borrower of the
proceeds of the Loan, including, without limitation, the fees and
disbursements of counsel incurred in connection with any such
investigation, litigation or other proceedings;
(b) any and all Losses arising out of or by reason of any
matter relating, directly or indirectly, to the Mortgages or the
ownership, condition, development, construction, sale, rental or
financing of the Premises or Improvements or any part thereof (but
excluding any such losses, liabilities, claims, damages or expenses
incurred solely by reason of the gross negligence or willful misconduct
of the party to be indemnified);
(c) any and all Losses arising due to this Agreement or any
documents, financial statements, reports, notices, schedules,
certificates, statements or other writings furnished by or on behalf of
Borrower or Mortgagors to Lender in connection with the negotiation of
this Agreement or the other Transaction Documents or the consummation
of the transactions contemplated hereby, or required herein or by the
other Transaction Documents to be furnished by or on behalf of Borrower
or Mortgagors, containing any untrue or misleading statement of a
material fact or omitting a material fact necessary to make the
statements herein or therein not misleading; or due to Borrower not
disclosing to Lender in writing any fact which materially affects
adversely or, so far as Borrower can now foresee, will result in a
Material Adverse Effect;
(d) any and all Losses due to violations of any requirement of
any Governmental Authorities with respect to any of the Mortgaged
Property or the Improvements;
(e) any and all Losses arising out of any failure of the
Premises Documents to be in full force and effect, or any defaults (or
events which with notice or the passage of time, or both, would
constitute such a default) under any thereof or any failure to satisfy
all conditions to the effectiveness and continuing effectiveness
thereof required to be satisfied as of the date hereof;
(f) any and all Losses arising due to (i) Borrower or any
Mortgagor or fiduciary of Borrower or any Mortgagor having engaged in
any prohibited transaction (as defined in Section 4975 of the Code or
Section 406 of ERISA) which could reasonably be expected to subject
Borrower, Mortgagors or any Person whom they have an obligation to
indemnify under this Agreement to any tax or penalty imposed under
Section 4975 of the Code or Section 502 of ERISA; (ii) Borrower or any
Mortgagor or any ERISA Affiliate maintaining, contributing to or having
any liability with respect to any plan subject to Title IV of ERISA or
Section 412 of the Code, other than any Multiemployer Plan; (iii)
Borrower or any Mortgagor or any ERISA Affiliate having incurred or
being reasonably expected to incur any withdrawal liability within the
meaning of Part I of Subtitle E of Title IV of ERISA to any
Multiemployer Plan, or any liability under Title IV of ERISA upon the
reorganization or termination of a Multiemployer Plan; (iv) any
Employee Benefit Plan, other than any Multiemployer Plan, not being
administered in accordance with its terms and in compliance with all
applicable Laws, including any reporting requirements; (v) any Pension
Plan intending to qualify under Section 401(a) or 401(k) of the Code
failing to so qualify other than any Multiemployer Plan; (vi) Borrower
or any Mortgagor having any liability for retiree medical or death
benefits (contingent or otherwise) other than as required by Section
4980B of the Code; and (vii) any part of the funds being used by
Borrower or any Mortgagor in satisfaction of their respective
obligations under this Agreement and the other Transaction Documents
constituting "plan assets" of any "employee benefit plan" within the
meaning of ERISA or of any "plan" within the meaning of Section
4975(e)(1) of the Code, as
20
interpreted by the Internal Revenue Service and the United States
Department of Labor in rules, regulations, releases or bulletins or as
interpreted under applicable case law.
The obligations of Borrower under this Section and under Section 3.01 shall
survive the repayment of all amounts due under or in connection with any of the
Transaction Documents and the termination of the Loan only for the period ending
on the fifth anniversary of such repayment and termination.
SECTION 8.10. Environmental Indemnification. Borrower agrees
to indemnify, defend and save and hold harmless Lender and its respective
officers, directors, employees, agents and advisors (each, an "Indemnified
Party") from and against any and all claims, damages, losses, liabilities and
expenses (including, without limitation, reasonable fees and expenses of
counsel) that may be incurred by or asserted or awarded against any Indemnified
Party, in each case arising out of or in connection with or by reason of
(including, without limitation, in connection with any investigation, litigation
or proceeding or preparation of a defense in connection therewith) the actual or
alleged presence of Hazardous Materials on any of the Premises or any
Environmental Action relating in any way to any of the Premises, except to the
extent such claim, damage, loss, liability or expense results from such
Indemnified Party's gross negligence or willful misconduct. In the case of an
investigation, litigation or other proceeding to which the indemnity in this
Section 8.10 applies, such indemnity shall at Lender's election be effective
whether or not such investigation, litigation or proceeding is brought by
Borrower, its directors, shareholders or creditors or an Indemnified Party, and
whether or not any Indemnified Party is otherwise a party thereto.
SECTION 8.11. Partial Release of Mortgaged Property. At any
time after the date hereof, Lender shall consent to a release from the lien of
the applicable Mortgage of a portion but less than all (a "Partial Release") of
any individual Mortgaged Property (the "Released Mortgaged Property"), provided
that Borrower has satisfied each of the following requirements:
(a) No Event of Default shall have occurred and be continuing
or shall result therefrom;
(b) At least one of the following conditions shall be
satisfied:
(i) the Loan to Value Ratio immediately following
such Partial Release shall not be materially greater than the
Loan to Value Ratio immediately prior to such Partial Release,
(ii) Borrower shall pay or cause to be paid to Lender
and Lender shall apply such amount as is necessary to assure
that the Loan to Value Ratio immediately following such
Partial Release shall not be materially greater than the Loan
to Value Ratio immediately prior to such Partial Release, or
(iii) the value of the Released Mortgage Property
shall not have been included in the Appraisal of such
Mortgaged Property delivered at the time of the Initial
Advance or Future Advance secured by such Mortgaged Property;
(c) Borrower's capacity to meet its payment obligations with
respect to the Note secured by the Mortgaged Property subject to such
Partial Release is neither substantially enhanced nor impaired within
the meaning of Treasury Regulation ss.1.100-3(e)(4)(iv); and
(d) Borrower shall have paid the reasonable costs and expenses
of Lender and Lender's counsel incurred in connection with such Partial
Release.
21
Upon satisfaction of the foregoing conditions, Lender shall release the Released
Mortgaged Property and related collateral. Lender shall promptly execute and
deliver to Borrower, at Borrower's sole cost and expense, any additional
documents required by law in order to release the Released Mortgaged Property
and related collateral.
SECTION 8.12. Counterparts. This Agreement may be executed in
any number of counterparts, all of which taken together shall constitute one and
the same instrument, and any party hereto may execute this Agreement by signing
any such counterpart.
SECTION 8.13. Governing Law; Jurisdiction. This Agreement and
the rights and obligations of the parties hereunder shall in all respects be
governed by, and construed and enforced in accordance with, the Laws of the
State of New York, including, without limitation, Section 5-1401 of the New York
General Obligations Laws (without giving effect to New York's principles of
conflicts of law). Borrower and Lender hereby irrevocably submit to the
non-exclusive jurisdiction of any New York State or Federal court sitting in The
City of New York over any suit, action or proceeding arising out of or relating
to this Agreement, and Borrower hereby agrees and consents that, in addition to
any methods of service of process provided for under applicable Law, all service
of process in any such suit, action or proceeding in any New York State or
Federal court sitting in The City of New York (or such other county in New York
State) may be made by certified or registered mail, return receipt requested,
directed to Borrower at the address indicated on the signature page hereof, and
service so made shall be complete five (5) days after the same shall have been
so mailed.
SECTION 8.14. Integration. The Transaction Documents
constitute the entire agreement among Borrower, Mortgagors and Lender relating
to the transactions contemplated thereby and supersede any prior oral or written
statements or agreements with respect to such transactions.
SECTION 8.15. Gross-Up for Taxes. All payments made by
Borrower under this Agreement and the Notes shall be made free and clear of, and
without deduction or withholding for or on account of, any present or future
income, stamp or other taxes, levies, imposts, duties, charges, fees, deductions
or withholdings, now or hereafter imposed, levied, collected, withheld or
assessed by any Governmental Authority, excluding income taxes and franchise or
other taxes (imposed in lieu of income taxes) imposed on Lender. If any such
non-excluded taxes, levies, imposts, duties, charges, fees, deductions or
withholdings ("Non-Excluded Taxes") are required to be withheld from any amounts
payable to Lender hereunder or under its Note, the amounts so payable to Lender
shall be increased to the extent necessary to yield to Lender (after payment of
all Non-Excluded Taxes) interest or any such other amounts payable with respect
to the Transactions at the rates or in the amounts specified in this Agreement
and the Notes. Whenever any Non-Excluded Taxes are payable by Borrower, as
promptly as possible thereafter Borrower shall send to Lender a certified copy
of an original official receipt received by Borrower showing payment thereof. If
Borrower fails to pay any Non-Excluded Taxes when due to the appropriate taxing
authority or fails to remit to Lender the required receipts or other required
documentary evidence, Borrower shall indemnify Lender for any incremental taxes,
interest or penalties that may become payable by Lender as a result of any such
failure. The agreements in this Section shall survive the termination of this
Agreement and the payment of the Notes and all other amounts payable hereunder.
SECTION 8.16. Assignment of Mortgages and Notes. Subject to
the consent of Borrower, Lender may assign or otherwise transfer all or any
portion of its rights and obligations under the Notes or the Mortgages to any
other Person, and such other Person shall thereupon become vested with all of
the rights and benefits in respect thereof granted to Lender under this
Agreement. Borrower, at Borrower's cost and expense, shall promptly execute and
deliver any and all documents and instruments reasonably requested by Lender to
evidence or confirm such assignment. Notwithstanding the foregoing,
22
Borrower hereby consents to the transfer of Lender's rights and obligations
under the Notes and Mortgages to Delphi Properties Holdings, LLC.
[Balance of Page Intentionally Left Blank]
23
IN WITNESS WHEREOF, the parties have executed and delivered
this Agreement as of the day and year first above written, the execution hereof
by Borrower constituting a certification by the party or parties executing on
its behalf that the representations and warranties made in Article V are true
and correct as of the date hereof and that each of them duly holds and is
incumbent in the position indicated under his or her name.
DELPHI CORPORATION,
a Delaware corporation
By:
--------------------------------
Name:
Title:
Address for notices:
5725 Delphi Drive
Troy, Michigan 48098
Attention: Alan S. Dawes
Telephone: (248) 813-2000
Telecopy: (248) 813-2670
DELPHI PROPERTIES, INC.,
a Maryland corporation
By:
--------------------------------
Name:
Title:
Address for notices:
c/o Delphi Corporation
5725 Delphi Drive
Troy, Michigan 48098
Attention: John G. Blahnik
Telephone: (248) 813-2000
Telecopy: (248) 813-2648
SCHEDULE IA
CONTRIBUTED NOTES
NOTE PRINCIPAL AMOUNT PREMISES SECURING NOTE
---- ---------------- ----------------------
Mortgage Note No. [$ ] [Address]
---- ----------------
Mortgage Note No. [$ ] [Address]
---- ----------------
SCHEDULE IB
MEMBERSHIP INTEREST PURCHASE NOTES
NOTE PRINCIPAL AMOUNT PREMISES SECURING NOTE
---- ---------------- ----------------------
Mortgage Note No. [$ ] [Address]
---- ----------------
Mortgage Note No. [$ ] [Address]
---- ----------------
SCHEDULE II
INITIAL ADVANCE NOTES
NOTE PRINCIPAL AMOUNT PREMISES SECURING NOTE
---- ---------------- ----------------------
Mortgage Note No. [$ ] [Address]
---- ----------------
Mortgage Note No. [$ ] [Address]
---- ----------------
SCHEDULE III
FUTURE ADVANCE NOTES
NOTE PRINCIPAL AMOUNT PREMISES SECURING NOTE
---- ---------------- ----------------------
Mortgage Note No. [$ ] [Address]
---- ----------------
Mortgage Note No. [$ ] [Address]
---- ----------------
EXHIBIT A
FORM OF MORTGAGE NOTE
Mortgage Note No. ____
$____________ New York, New York
____________, 200__
For value received, DELPHI CORPORATION, a Delaware corporation
("Maker"), hereby covenants and promises to pay to the order of DELPHI
PROPERTIES, INC., a Maryland corporation or its successors or assigns
(collectively, "Lender"), located c/o Delphi Corporation, 5725 Delphi Drive,
Troy, Michigan 48098 for the account of Lender, the principal sum of
_________________________ Dollars ($____________), in lawful money of the United
States and in immediately available funds, in accordance with the terms set
forth in the Contribution and Loan Agreement (as defined below). Maker also
covenants and promises to pay interest on the unpaid principal balance hereof,
for the period such balance is outstanding, in like money, at said office for
the account of Lender, at the time and at a rate per annum as provided in the
Contribution and Loan Agreement. Any amount or principal hereof which is not
paid when due, whether at stated maturity, by acceleration, or otherwise, shall
bear interest from the date when due until said principal amount is paid in
full, payable on demand, at the Interest Rate.
This Note is one of the Notes referred to in the Contribution
and Loan Agreement dated as of the date hereof (as the same may be amended or
supplemented from time to time, the "Contribution and Loan Agreement") by and
between Maker, as Borrower, and Lender. All of the terms, conditions and
provisions of the Contribution and Loan Agreement are hereby incorporated by
reference. All capitalized terms used herein and not defined herein shall have
the meanings given to them in the Contribution and Loan Agreement.
This Note is secured by that certain [Mortgage/Deed of Trust,
Security Agreement, Assignment of Leases and Rents and Fixture Filing] dated as
of even date herewith made by [Name of Mortgagor/Grantor] for the benefit of
Lender and covering the premises commonly known as [Address of Mortgaged
Property]. Reference to the Mortgage is hereby made for a description of the
"Mortgaged Property" encumbered thereby and the rights of Maker, and Lender with
respect to such Mortgaged Property.
Should the indebtedness represented by this Note or any part
thereof be collected at law or in equity, or in bankruptcy, receivership or any
other court proceeding (whether at the trial or appellate level), or should this
Note be placed in the hands of attorneys for collection upon default, Maker
agrees to pay, in addition to the principal, interest and other sums due and
payable hereon, all costs of collecting or attempting to collect this Note,
including reasonable attorneys' fees and expenses.
All parties to this Note, whether principal, surety, guarantor
or endorser, hereby waive presentment for payment, demand, protest, notice of
protest and notice of dishonor.
This Note shall be governed by the Laws of the State of New
York, including, without limitation, Section 5-1401 of the New York General
Obligations Laws (without giving effect to New York's principles of conflicts of
law), provided that, as to the maximum lawful rate of interest which may be
charged or collected, if the Laws applicable to Lender permit it to charge or
collect a higher rate than the Laws of the State of New York, then such Law
applicable to Lender shall apply to Lender under this Note.
Anything herein to the contrary notwithstanding, the
obligations of Maker under this Note shall be subject to the limitation that
payments of interest shall not be required to the extent that receipt of any
such payment by Lender would be contrary to provisions of Law applicable to
Lender limiting the maximum rate of interest that may be charged or collected by
Lender.
IN WITNESS WHEREOF, Maker has executed and delivered this Note
as of the date first above written.
DELPHI CORPORATION
By:
-------------------------------
Name:
Title:
EXHIBIT B
FORM OF MORTGAGE
DEED OF TRUST, SECURITY AGREEMENT, ASSIGNMENT OF RENTS
AND LEASES AND FIXTURE FILING ([STATE])
BY AND FROM
[DELPHI SUBSIDIARY], "GRANTOR"
TO
[TRUSTEE], "TRUSTEE"
FOR THE BENEFIT OF
DELPHI PROPERTIES, INC., "BENEFICIARY"
DATED AS OF [__________] [__], 2003
LOCATION: [__________]
MUNICIPALITY: [__________]
COUNTY: [__________]
STATE: [__________]
THIS INSTRUMENT SECURES MORTGAGE NOTE NO. [___].
THE SECURED PARTY (BENEFICIARY) DESIRES THIS FIXTURE FILING
TO BE INDEXED AGAINST THE RECORD OWNER OF THE REAL ESTATE
DESCRIBED HEREIN.
PREPARED BY, RECORDING REQUESTED BY,
AND WHEN RECORDED MAIL TO:
SHEARMAN & STERLING
599 LEXINGTON AVENUE
NEW YORK, NEW YORK 10022-6069
ATTENTION: MALCOLM M. KRATZER, ESQ.
FILE #31135-00012
DEED OF TRUST, SECURITY AGREEMENT, ASSIGNMENT OF RENTS
AND LEASES AND FIXTURE FILING ([STATE])
THIS DEED OF TRUST, SECURITY AGREEMENT, ASSIGNMENT OF RENTS
AND LEASES AND FIXTURE FILING ([STATE]) (this "DEED OF TRUST") is dated as of
[_________] [___], 2003 by and from [DELPHI SUBSIDIARY], a [state of
organization and entity type] ("GRANTOR"), whose address is [Delphi Subsidiary
Address] to [TRUSTEE], a [state of organization and entity type] ("TRUSTEE"),
with an address at [Trustee's Address], for the benefit of DELPHI PROPERTIES,
INC., a Maryland corporation, having an address at c/o Delphi Corporation, 5725
Delphi Drive, Troy, Michigan 48098 ("BENEFICIARY").
RECITALS
WHEREAS, Delphi Corporation ("BORROWER") and Beneficiary have
entered into that certain Contribution and Loan Agreement dated as of even date
herewith (as the same may be amended, amended and restated, supplemented or
otherwise modified from time to time, the "CONTRIBUTION AND LOAN AGREEMENT");
and
WHEREAS, pursuant to the Contribution and Loan Agreement, it
is a condition precedent to the entering into of the Transactions (as defined
therein) by Beneficiary that Grantor shall execute and deliver this Deed of
Trust,
NOW, THEREFORE, in consideration of the foregoing recitals,
which are incorporated into the operative provisions of this Deed of Trust by
this reference, and for other good and valuable consideration, the receipt and
adequacy of which are hereby conclusively acknowledged, Grantor hereby agrees as
follows:
ARTICLE 1
DEFINITIONS
SECTION 1.1 DEFINITIONS. All capitalized terms used herein
without definition shall have the respective meanings ascribed to them in the
Contribution and Loan Agreement. As used herein, the following terms shall have
the following meanings:
(a) "BANKRUPTCY CODE": Title 11 of the United States Code, as
amended, or any similar federal or state law for the relief of debtors.
(b) "EVENT OF DEFAULT": An Event of Default under and as
defined in the Contribution and Loan Agreement.
(c) "INDEBTEDNESS": All indebtedness and liabilities of
Grantor to Beneficiary now or hereafter existing (1) that is evidenced by the
Note, including, without limitation, all principal, interest and other sums and
amounts from time to time owing thereunder or evidenced thereby, and (2) that
relates in whole or in part to the Mortgaged Property, the Note or Grantor and
arises under documents which recite that they are intended to be secured by this
Deed of Trust.
(d) "MORTGAGED PROPERTY": The fee interest in the real
property described in Exhibit A attached hereto and incorporated herein by this
reference, together with any greater estate therein as hereafter may be acquired
by Grantor (the "LAND"), and all of Grantor's right, title and interest in and
to (1) all improvements now owned or hereafter acquired by Grantor, now or at
any time situated, placed or constructed upon the Land (the "IMPROVEMENTS"; the
Land and Improvements are collectively referred to
as the "PREMISES"), (2) all materials, supplies, equipment, apparatus and other
items of personal property now owned or hereafter acquired by Grantor and now or
hereafter attached to, installed in or used in connection with any of the
Improvements or the Land, and water, gas, electrical, telephone, storm and
sanitary sewer facilities and all other utilities whether or not situated in
easements which constitute fixtures under the laws of the state in which the
Land is located (the "FIXTURES"), (3) all leases, licenses, concessions,
occupancy agreements or other agreements (written or oral, now or at any time in
effect) which grant to any Person a possessory interest in, or the right to use,
all or any part of the Mortgaged Property, together with all related security
and other deposits (the "LEASES"), (4) all of the rents, revenues, royalties,
income, proceeds, profits, security and other types of deposits, and other
benefits paid or payable by parties to the Leases for using, leasing, licensing
possessing, operating from, residing in, selling or otherwise enjoying the
Mortgaged Property (the "RENTS"), (5) all rights, privileges, tenements,
hereditaments, rights-of-way, easements, appendages and appurtenances
appertaining to the foregoing, (6) all property tax refunds payable with respect
to the Mortgaged Property (the "TAX REFUNDS"), (7) all accessions, replacements
and substitutions for any of the foregoing and all proceeds thereof (the
"PROCEEDS"), (8) all proceeds of insurance covering any of the above property
now or hereafter acquired by Grantor (the "INSURANCE"), and (9) all awards,
damages, remunerations, reimbursements, settlements or compensation heretofore
made or hereafter to be made by any governmental authority pertaining to any
condemnation or other taking (or any purchase in lieu thereof) of all or any
portion of the Land, Improvements or Fixtures (the "CONDEMNATION AWARDS"). As
used in this Deed of Trust, the term "Mortgaged Property" shall mean all or,
where the context permits or requires, any portion of the above or any interest
therein.
(e) "NOTE": Mortgage Note No. [___] dated of even date
herewith issued by Borrower to Beneficiary, as the same may be amended, amended
and restated, supplemented, extended, replaced or otherwise modified from time
to time.
(f) "OBLIGATIONS": All of the agreements, covenants,
conditions, warranties, representations and other obligations of Borrower under
the Contribution and Loan Agreement and the other Transaction Documents to which
it is a party that relate in whole or in part to the Note, the Mortgaged
Property or Grantor, including, without limitation, the obligation to repay the
Indebtedness in accordance with the terms of the Note and the Contribution and
Loan Agreement; provided, however, that the Obligations secured hereby shall
exclude the obligation to repay the "Indebtedness" under and as defined in any
Mortgage Note issued pursuant to the Contribution and Loan Agreement other than
the Note.
(g) "UCC": The Uniform Commercial Code of [State] or, if the
creation, perfection and enforcement of any security interest herein granted is
governed by the laws of a state other than [State], then, as to the matter in
question, the Uniform Commercial Code in effect in that state.
ARTICLE 2
GRANT
SECTION 2.1 GRANT. To secure the full and timely payment of
the Indebtedness and the full and timely performance of the Obligations, Grantor
GRANTS, BARGAINS, ASSIGNS, SELLS, CONVEYS and CONFIRMS, to Trustee the Mortgaged
Property, subject, however, to Permitted Liens, TO HAVE AND TO HOLD the
Mortgaged Property, IN TRUST, WITH POWER OF SALE, and Grantor does hereby bind
itself, its successors and assigns to WARRANT AND FOREVER DEFEND the title to
the Mortgaged Property unto Trustee.
2
ARTICLE 3
WARRANTIES, REPRESENTATIONS AND COVENANTS
Grantor warrants, represents and covenants to Beneficiary as
follows:
SECTION 3.1 TITLE TO MORTGAGED PROPERTY AND LIEN OF THIS
INSTRUMENT. Grantor owns the Mortgaged Property free and clear of any liens,
claims or interests, except the Permitted Liens. This Deed of Trust creates
valid, enforceable first priority liens and security interests against the
Mortgaged Property.
SECTION 3.2 FIRST LIEN STATUS. Grantor shall preserve and
protect the first lien and security interest status of this Deed of Trust and
the other Transaction Documents, subject to Permitted Liens. If any lien or
security interest other than a Permitted Lien is asserted against the Mortgaged
Property, Grantor shall promptly, and at its expense, pay the underlying claim
in full or take such other action so as to cause it to be released or contest
the same in such manner as shall prevent the foreclosure thereof.
SECTION 3.3 PAYMENT AND PERFORMANCE. Grantor shall pay the
Indebtedness when due under the Contribution and Loan Agreement and the other
Transaction Documents and shall perform the Obligations in full when they are
required to be performed.
SECTION 3.4 REPLACEMENT OF FIXTURES. Grantor shall not,
without the prior written consent of Beneficiary (which consent shall not be
unreasonably withheld, conditioned or delayed), permit any of the Fixtures owned
or leased by Grantor to be removed at any time from the Land or Improvements,
unless the removed item is removed temporarily for maintenance and repair or is
permitted to be removed by the Contribution and Loan Agreement or the removal
will not materially reduce the value of the Mortgaged Property.
SECTION 3.5 INSPECTION. Grantor shall permit Beneficiary, and
Beneficiary's agents, representatives and employees, upon reasonable prior
notice to Grantor, to inspect the Mortgaged Property and all books and records
of Grantor located thereon that are related directly to the Mortgaged Property,
and to conduct such environmental and engineering studies as Beneficiary may
require, provided that such inspections and studies shall not materially
interfere with the use and operation of the Mortgaged Property and shall be
performed in accordance with such requirements as Grantor shall reasonably
impose.
SECTION 3.6 OTHER COVENANTS. All of the covenants in the
Contribution and Loan Agreement are incorporated herein by reference and,
together with covenants in this Article 3, shall be covenants running with the
land.
SECTION 3.7 INSURANCE; CONDEMNATION AWARDS AND INSURANCE
PROCEEDS.
(a) Insurance. Grantor shall maintain or cause to be
maintained in full force and effect the following insurance coverages: (i)
property "all risk" insurance covering the Mortgaged Property; and (ii) such
other insurance as may be required by applicable Law (including worker's
compensation and employer's liability insurance) or as Beneficiary may
reasonably require from time to time. Any policy of property insurance required
by clause (i) above shall be in an amount not less than the full replacement
cost of the Improvements and any personal property covered by such policy, shall
contain a "full replacement cost" endorsement, shall insure against flood loss
risk if the Land is located in a Flood Hazard Area, and shall name Beneficiary
as an additional insured or mortgagee and as a "loss payee". All insurance
policies shall be in form and substance and issued by insurers reasonably
satisfactory to
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Beneficiary, and shall contain such deductibles and such endorsements as
Beneficiary may reasonably require.
(b) Condemnation Awards. Grantor assigns all Condemnation
Awards to Beneficiary, provided that Grantor shall have the right to collect and
receive such Condemnation Awards and to give proper receipts and acquittances
therefor, subject to the terms of the Contribution and Loan Agreement.
(c) Insurance Proceeds. Grantor assigns to Beneficiary all
proceeds of any insurance policies insuring against loss or damage to the
Mortgaged Property, provided that Grantor shall have the right to settle, adjust
and compromise all insurance claims, subject to the terms of the Contribution
and Loan Agreement.
SECTION 3.8 CREATION OF LIENS. Grantor shall not enter into
any contract or arrangement of any kind the performance of which by the other
party thereto would give rise to a Lien, other than a Permitted Lien or as
otherwise permitted pursuant to the Contribution and Loan Agreement, on the
Mortgaged Property.
SECTION 3.9 MAINTENANCE OF EXISTENCE. [INSERT IF GRANTOR IS
NOT A RELATED MORTGAGOR: Grantor shall preserve and keep in full force and
effect its existence, franchises, rights and privileges as a business or stock
corporation, partnership, limited liability company, trust or other entity under
the laws of Grantor's jurisdiction of formation or organization.]
ARTICLE 4
WAIVERS AND ACKNOWLEDGEMENTS; LIMITATION OF LIABILITY
SECTION 4.1 GRANTOR OBLIGATIONS ABSOLUTE. Grantor agrees that
the Obligations will be performed strictly in accordance with the terms of the
Transaction Documents. The obligations of Grantor under or in respect of this
Deed of Trust are independent of any other obligations of any other Person under
or in respect of the Transaction Documents, and a separate action or actions may
be brought and prosecuted against Grantor to enforce this Deed of Trust,
irrespective of whether any action is brought against Borrower or any other
Person or whether Borrower or any other Person is joined in any such action or
actions. The liability of Grantor under this Deed of Trust shall be irrevocable,
absolute and unconditional irrespective of, and Grantor hereby irrevocably
waives any defenses it may now have or hereafter acquire in any way relating to,
any or all of the following:
(a) any lack of validity or enforceability of any Transaction
Document or any agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment of, or
in any other term of, all or any of the Obligations under or in respect of the
Transaction Documents or any other amendment or waiver of or any consent to
departure from any Transaction Document, including, without limitation, any
increase in the Indebtedness resulting from the extension of additional credit
to Borrower or any of Borrower's Affiliates or otherwise;
(c) any taking, exchange, release or non-perfection of any
collateral secured under the Transaction Documents, or any taking, release or
amendment or waiver of, or consent to departure from, any other Transaction
Document securing any of the Obligations;
(d) any manner of application of collateral securing any of
the Obligations under the Transaction Documents, or any proceeds of such
collateral, to all or any of the Obligations, or any manner
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of sale or other disposition of any other collateral for all or any obligations
of Borrower or its Affiliates under the Transaction Documents or any other
assets of Borrower or any of its Affiliates;
(e) any change, restructuring or termination of the corporate
structure or existence of Borrower or any of its Affiliates;
(f) any failure of Trustee or Beneficiary to disclose to
Borrower or its Affiliates any information relating to the business, condition
(financial or otherwise), operations, performance, properties or prospects of
Borrower or its Affiliates now or hereafter known to Trustee or Beneficiary
(Grantor waiving any duty on the part of Trustee or Beneficiary to disclose such
information);
(g) the failure of any other Person to execute or deliver any
guaranty, security instrument, or agreement or the release or reduction of
liability of any Person or other surety with respect to the Obligations; or
(h) any statute of limitations or any existence of or reliance
on any representation by Trustee or Beneficiary that might otherwise constitute
a defense available to, or a discharge of, Borrower or any of its Affiliates.
This Deed of Trust shall continue to be effective or be reinstated, as the case
may be, if at any time any payment or performance of any of the Obligations is
rescinded or must otherwise be returned by Beneficiary or any other Person upon
the insolvency, bankruptcy or reorganization of Borrower or any of its
Affiliates or otherwise, all as though such payment had not been made.
SECTION 4.2 WAIVERS AND ACKNOWLEDGMENTS. Grantor hereby
unconditionally and irrevocably waives promptness, diligence, notice of
acceptance, presentment, demand for performance, notice of nonperformance,
default, acceleration, protest or dishonor and any other notice with respect to
any of the Obligations and this Deed of Trust and any requirement that
Beneficiary protect, secure, perfect or insure any Lien or any property subject
thereto or exhaust any right or take any action against Borrower or any other
Person or any other collateral securing the Obligations or any part thereof.
(a) Grantor hereby unconditionally and irrevocably waives any
right to revoke this Deed of Trust and acknowledges that this Deed of Trust is
continuing in nature and applies to all of the Obligations, whether existing now
or in the future.
(b) Grantor hereby unconditionally and irrevocably waives (i)
any defense arising by reason of any claim or defense based upon an election of
remedies by Trustee or Beneficiary that in any manner impairs, reduces, releases
or otherwise adversely affects the subrogation, reimbursement, exoneration,
contribution or indemnification rights of Grantor or other rights of Grantor to
proceed against Borrower or any other Person or any collateral securing any of
the Obligations and (ii) any defense based on any right of set-off or
counterclaim against or in respect of the Obligations of Grantor hereunder.
(c) Grantor acknowledges that Beneficiary may, without notice
to or demand upon Grantor and without affecting the liability of Grantor under
this Deed of Trust, foreclose under any of the Mortgages (as such term is
defined in the Contribution and Loan Agreement) by nonjudicial sale, and Grantor
hereby waives any defense to the recovery by Beneficiary against Grantor of any
deficiency after such nonjudicial sale and any defense or benefits that may be
afforded by applicable law.
(d) Grantor hereby unconditionally and irrevocably waives any
duty on the part of Trustee or Beneficiary to disclose to Grantor any matter,
fact or thing relating to the business, condition
5
(financial or otherwise), operations, performance, properties or prospects of
Borrower or any of its Affiliates now or hereafter known by Trustee or
Beneficiary.
(e) Grantor acknowledges that it will receive substantial
direct and indirect benefits from the financing arrangements contemplated by the
Transaction Documents and that the waivers set forth in this Section 4.2 are
knowingly made in contemplation of such benefits.
SECTION 4.3 SUBROGATION. Grantor hereby unconditionally and
irrevocably agrees not to exercise any rights that it may now have or hereafter
acquire against Borrower that arise from the existence, payment, performance or
enforcement of the Obligations under or in respect of this Deed of Trust or any
other Transaction Document, including, without limitation, any right of
subrogation, reimbursement, exoneration, contribution or indemnification and any
right to participate in any claim or remedy of Beneficiary against the Borrower
or any collateral securing any of the Obligations, whether or not such claim,
remedy or right arises in equity or under contract, statute or common law,
including, without limitation, the right to take or receive from Borrower,
directly or indirectly, in cash or other property or by set-off or in any other
manner, payment or security on account of such claim, remedy or right, except at
such times as all of the Obligations and all other amounts then due and payable
under this Deed of Trust shall have been paid or performed. If (a) Grantor shall
make payment to Beneficiary of all or any part of the Obligations, (b) all of
the Obligations shall have been indefeasibly paid or performed in full or (c)
the Maturity Date shall have occurred, Beneficiary will, at Grantor's request
and expense, execute and deliver to Grantor appropriate documents, without
recourse and without representation or warranty, necessary to evidence the
transfer by subrogation to Grantor of an interest in the Obligations resulting
from such payment made by Grantor pursuant to this Deed of Trust.
SECTION 4.4 LIMITATION OF LIABILITY. Grantor, and by their
acceptance of this Deed of Trust, Trustee and Beneficiary, hereby confirm that
it is the intention of all such Persons that this Deed of Trust and the
Obligations of Grantor hereunder shall not constitute a fraudulent transfer or
conveyance for purposes of the Bankruptcy Code, the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act or any similar foreign,
federal or state law, or any case or proceeding under any such laws, to the
extent applicable to this Deed of Trust and the Obligations of Grantor
hereunder. To effectuate the foregoing intention, Grantor, Trustee and
Beneficiary hereby irrevocably agree that, notwithstanding any provision herein
or in the other Transaction Documents to the contrary, the Obligations of
Grantor under this Deed of Trust at any time shall be limited to the maximum
amount as will result in the Obligations of Grantor under this Deed of Trust not
constituting a fraudulent transfer or conveyance.
SECTION 4.5 LIMITED RECOURSE. Notwithstanding any provision
herein or in any other Transaction Document to the contrary, following the
occurrence of an Event of Default, Beneficiary shall look solely to Borrower,
the Mortgaged Property and any other security provided under the other
Transaction Documents for the repayment of the Obligations and will not enforce
a deficiency judgment against Grantor. Nothing contained in this Section 4.5,
however, shall modify, diminish or discharge the personal liability of Borrower,
and nothing herein shall be deemed to be a waiver of any right which Beneficiary
may have under any other provision of the Bankruptcy Code to file a claim for
the full amount due to Beneficiary under the Note or to require that the
Mortgaged Property shall continue to secure the Obligations.
ARTICLE 5
DEFAULT AND FORECLOSURE
SECTION 5.1 REMEDIES. Upon the occurrence and during the
continuance of an Event of Default, Beneficiary may, at Beneficiary's election
and by or through Trustee or otherwise, exercise any or all of the following
rights, remedies and recourses:
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(a) Acceleration. Subject to any provisions of the Transaction
Documents providing for the automatic acceleration of the Indebtedness upon the
occurrence of certain Events of Default, declare the Indebtedness to be
immediately due and payable, without further notice, presentment, protest,
notice of intent to accelerate, notice of acceleration, demand or action of any
nature whatsoever (each of which hereby is expressly waived by Grantor),
whereupon the same shall become immediately due and payable.
(b) Entry on Mortgaged Property. Enter the Mortgaged Property
and take exclusive possession thereof and of all books, records and accounts
relating thereto or located thereon. If Grantor remains in possession of the
Mortgaged Property following the occurrence and during the continuance of an
Event of Default and without Beneficiary's prior written consent, Beneficiary
may invoke any legal remedies to dispossess Grantor.
(c) Operation of Mortgaged Property. Hold, lease, develop,
manage, operate or otherwise use the Mortgaged Property upon such terms and
conditions as Beneficiary may deem reasonable under the circumstances (making
such repairs, alterations, additions and improvements and taking other actions,
from time to time, as Beneficiary deems necessary or desirable), and apply all
Rents and other amounts collected by Trustee or Beneficiary in connection
therewith in accordance with the provisions of Section 5.7.
(d) Foreclosure and Sale. Institute proceedings for the
complete foreclosure of this Deed of Trust by judicial action or by power of
sale, in which case the Mortgaged Property may be sold for cash or credit in one
or more parcels as Beneficiary may determine. With respect to any notices
required or permitted under the UCC, Grantor agrees that ten (10) days' prior
written notice shall be deemed commercially reasonable. At any such sale by
virtue of any judicial proceedings, power of sale, or any other legal right,
remedy or recourse, the title to and right of possession of any such property
shall pass to the purchaser thereof, and to the fullest extent permitted by law,
Grantor shall be completely and irrevocably divested of all of its right, title,
interest, claim, equity, equity of redemption, and demand whatsoever, either at
law or in equity, in and to the property sold and such sale shall be a perpetual
bar both at law and in equity against Grantor, and against all other Persons
claiming or to claim the property sold or any part thereof, by, through or under
Grantor. Beneficiary may be a purchaser at such sale and if Beneficiary is the
highest bidder, Beneficiary may credit the portion of the purchase price that
would be distributed to Beneficiary against the Indebtedness in lieu of paying
cash. In the event this Deed of Trust is foreclosed by judicial action,
appraisement of the Mortgaged Property is waived.
(e) Receiver. Make application to a court of competent
jurisdiction for, and obtain from such court as a matter of strict right and
without notice to Grantor or regard to the adequacy of the Mortgaged Property
for the repayment of the Indebtedness, the appointment of a receiver of the
Mortgaged Property, and Grantor irrevocably consents to such appointment. Any
such receiver shall have all the usual powers and duties of receivers in similar
cases, including the full power to rent, maintain and otherwise operate the
Mortgaged Property upon such terms as may be approved by the court, and shall
apply such Rents in accordance with the provisions of Section 5.7.
(f) Other. Exercise all other rights, remedies and recourses
granted under the Transaction Documents or otherwise available at law or in
equity.
SECTION 5.2 SEPARATE SALES. The Mortgaged Property may be sold
in one or more parcels and in such manner and order as Trustee in its sole
discretion may elect. The right of sale arising out of any Event of Default
shall not be exhausted by any one or more sales.
SECTION 5.3 REMEDIES CUMULATIVE, CONCURRENT AND NONEXCLUSIVE.
Trustee and Beneficiary shall have all rights, remedies and recourses granted in
the Transaction Documents and
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available at law or equity (including the UCC), which rights (a) shall be
cumulated and concurrent, (b) may be pursued separately, successively or
concurrently against Grantor or others obligated under the Transaction
Documents, or against the Mortgaged Property, or against any one or more of
them, at the sole discretion of Trustee or Beneficiary, as the case may be, (c)
may be exercised as often as occasion therefor shall arise, and the exercise or
failure to exercise any of them shall not be construed as a waiver or release
thereof or of any other right, remedy or recourse, and (d) are intended to be,
and shall be, nonexclusive. No action by Trustee or Beneficiary in the
enforcement of any rights, remedies or recourses under the Transaction Documents
or otherwise at law or equity shall be deemed to cure any Event of Default.
SECTION 5.4 RELEASE OF AND RESORT TO COLLATERAL. Beneficiary
may release, regardless of consideration and without the necessity for any
notice to or consent by the holder of any subordinate lien on the Mortgaged
Property, any part of the Mortgaged Property without, as to the remainder, in
any way impairing, affecting, subordinating or releasing the lien or security
interest created in or evidenced by the Transaction Documents or their status as
a first and prior lien and security interest in and to the Mortgaged Property.
For payment of the Indebtedness, Beneficiary may resort to any other security in
such order and manner as Beneficiary may elect.
SECTION 5.5 WAIVER OF REDEMPTION, NOTICE AND MARSHALLING OF
ASSETS. To the fullest extent permitted by law, Grantor hereby irrevocably and
unconditionally waives and releases (a) all benefit that might accrue to Grantor
by virtue of any present or future statute of limitations or law or judicial
decision exempting the Mortgaged Property from attachment, levy or sale on
execution or providing for any stay of execution, exemption from civil process,
redemption or extension of time for payment, (b) all notices of any Event of
Default or of any election by Trustee or Beneficiary to exercise or the actual
exercise of any right, remedy or recourse provided for under the Transaction
Documents, and (c) any right to a marshalling of assets or a sale in inverse
order of alienation.
SECTION 5.6 DISCONTINUANCE OF PROCEEDINGS. If Trustee or
Beneficiary shall have proceeded to invoke any right, remedy or recourse
permitted under the Transaction Documents and shall thereafter elect to
discontinue or abandon it for any reason, Trustee or Beneficiary, as the case
may be, shall have the unqualified right to do so and, in such an event,
Grantor, Trustee and Beneficiary shall be restored to their former positions
with respect to the Indebtedness, the Obligations, the Transaction Documents,
the Mortgaged Property and otherwise, and the rights, remedies, recourses and
powers of Beneficiary and Trustee shall continue as if the right, remedy or
recourse had never been invoked, but no such discontinuance or abandonment shall
waive any Event of Default which may then exist or the right of Trustee or
Beneficiary thereafter to exercise any right, remedy or recourse under the
Transaction Documents for such Event of Default.
SECTION 5.7 APPLICATION OF PROCEEDS. The proceeds of any sale
of, and the Rents and other amounts generated by the holding, leasing,
management, operation or other use of the Mortgaged Property, shall be applied
by Beneficiary or Trustee (or the receiver, if one is appointed) in the
following order unless otherwise required by applicable law:
(a) to the payment of the costs and expenses of taking
possession of the Mortgaged Property and of holding, using, leasing, repairing,
improving and selling the same, including, without limitation (1) trustee's and
receiver's fees and expenses, including the repayment of the amounts evidenced
by any receiver's certificates, (2) court costs, (3) attorneys' and accountants'
fees and expenses, and (4) costs of advertisement;
(b) to the payment of the Indebtedness and performance of the
Obligations in such manner and order of preference as Beneficiary in its sole
discretion may determine; and
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(c) the balance, if any, to the Persons legally entitled
thereto.
SECTION 5.8 OCCUPANCY AFTER FORECLOSURE. Any sale of the
Mortgaged Property or any part thereof in accordance with Section 5.1(d) will
divest all right, title and interest of Grantor in and to the property sold.
Subject to applicable law, any purchaser at a foreclosure sale will receive
immediate possession of the property purchased. If Grantor retains possession of
such property or any part thereof subsequent to such sale, Grantor will be
considered a tenant at sufferance of the purchaser, and will, if Grantor remains
in possession after demand to remove, be subject to eviction and removal,
forcible or otherwise, with or without process of law.
SECTION 5.9 ADDITIONAL ADVANCES AND DISBURSEMENTS; COSTS OF
ENFORCEMENT.
(a) Upon the occurrence and during the continuance of an Event
of Default, Beneficiary shall have the right, but not the obligation, to cure
such Event of Default in the name and on behalf of Grantor. All sums advanced
and expenses incurred at any time by Beneficiary under this Section 5.9, or
otherwise under this Deed of Trust or any of the other Transaction Documents or
applicable law, shall bear interest from the date that such sum is advanced or
expense incurred, to and including the date of reimbursement, computed at the
highest rate at which interest is then computed on any portion of the
Indebtedness, and all such sums, together with interest thereon, shall be
secured by this Deed of Trust.
(b) Grantor shall pay all expenses (including reasonable
attorneys' fees and expenses) of or incidental to the perfection and enforcement
of this Deed of Trust and the other Transaction Documents, or the enforcement,
compromise or settlement of the Indebtedness or any claim under this Deed of
Trust and the other Transaction Documents, and for the curing thereof, or for
defending or asserting the rights and claims of Beneficiary in respect thereof,
by litigation or otherwise.
SECTION 5.10 NO BENEFICIARY IN POSSESSION. Neither the
enforcement of any of the remedies under this Article 5, the assignment of the
Rents and Leases under Article 6, the security interests under Article 7, nor
any other remedies afforded to Beneficiary under the Transaction Documents, at
law or in equity shall cause Trustee or Beneficiary to be deemed or construed to
be a mortgagee in possession of the Mortgaged Property, to obligate Trustee or
Beneficiary to lease the Mortgaged Property or attempt to do so, or to take any
action, incur any expense, or perform or discharge any obligation, duty or
liability whatsoever under any of the Leases or otherwise.
ARTICLE 6
ASSIGNMENT OF RENTS AND LEASES
SECTION 6.1 ASSIGNMENT. In furtherance of and in addition to
the assignment made by Grantor in Section 2.1 of this Deed of Trust, Grantor
hereby absolutely and unconditionally assigns, sells, transfers and conveys to
Trustee (for the benefit of Beneficiary) and to Beneficiary all of its right,
title and interest in and to all Leases, whether now existing or hereafter
entered into, and all of its right, title and interest in and to all Rents. This
assignment is an absolute assignment and not an assignment for additional
security only. So long as no Event of Default shall have occurred and be
continuing, Grantor shall have a revocable license from Trustee and Beneficiary
to exercise all rights extended to the landlord under the Leases, including the
right to receive and collect all Rents and to hold the Rents in trust for use in
the payment and performance of the Obligations and to otherwise use the same.
The foregoing license is granted subject to the conditional limitation that no
Event of Default shall have occurred and be continuing. Upon the occurrence and
during the continuance of an Event of Default, whether or not legal proceedings
have commenced, and without regard to waste, adequacy of security for the
Obligations or solvency of Grantor, the license herein granted shall
automatically expire and terminate, without notice to
9
Grantor by Trustee or Beneficiary (any such notice being hereby expressly waived
by Grantor to the extent permitted by applicable law).
SECTION 6.2 PERFECTION UPON RECORDATION. Grantor acknowledges
that Beneficiary and Trustee have taken all actions necessary to obtain, and
that upon recordation of this Deed of Trust Beneficiary and Trustee shall have,
to the extent permitted under applicable law, a valid and fully perfected, first
priority, present assignment of the Rents arising out of the Leases and all
security for such Leases. Grantor acknowledges and agrees that upon recordation
of this Deed of Trust Trustee's and Beneficiary's interest in the Rents shall be
deemed to be fully perfected, "choate" and enforced as to Grantor and to the
extent permitted under applicable law, all third parties, including, without
limitation, any subsequently appointed trustee in any case under the Bankruptcy
Code, without the necessity of commencing a foreclosure action with respect to
this Deed of Trust, making formal demand for the Rents, obtaining the
appointment of a receiver or taking any other affirmative action.
SECTION 6.3 BANKRUPTCY PROVISIONS. Without limitation of the
absolute nature of the assignment of the Rents hereunder, Grantor, Trustee and
Beneficiary agree that (a) this Deed of Trust shall constitute a "security
agreement" for purposes of Section 552(b) of the Bankruptcy Code, (b) the
security interest created by this Deed of Trust extends to property of Grantor
acquired before the commencement of a case in bankruptcy and to all amounts paid
as Rents and (c) such security interest shall extend to all Rents acquired by
the estate after the commencement of any case in bankruptcy.
SECTION 6.4 NO MERGER OF ESTATES. So long as part of the
Indebtedness and the Obligations secured hereby remain unpaid and undischarged,
the fee and leasehold estates to the Mortgaged Property shall not merge, but
shall remain separate and distinct, notwithstanding the union of such estates
either in Grantor, Beneficiary, any tenant or any third party by purchase or
otherwise.
ARTICLE 7
SECURITY AGREEMENT
SECTION 7.1 SECURITY INTEREST. This Deed of Trust constitutes
a "security agreement" on personal property within the meaning of the UCC and
other applicable law and with respect to the Fixtures, Leases, Rents, Tax
Refunds, Proceeds, Insurance and Condemnation Awards. To this end, Grantor
grants to Beneficiary a first and prior security interest in the Fixtures,
Leases, Rents, Tax Refunds, Proceeds, Insurance and Condemnation Awards to
secure the payment of the Indebtedness and performance of the Obligations, and
agrees that Beneficiary shall have all the rights and remedies of a secured
party under the UCC with respect to such property. Any notice of sale,
disposition or other intended action by Beneficiary with respect to the
Fixtures, Leases, Rents, Tax Refunds, Proceeds, Insurance and Condemnation
Awards sent to Grantor at least ten (10) days prior to any action under the UCC
shall constitute reasonable notice to Grantor.
SECTION 7.2 FINANCING STATEMENTS. Grantor shall prepare and
deliver to Beneficiary such financing statements, and shall execute and deliver
to Beneficiary such other documents, instruments and further assurances, in each
case in form and substance satisfactory to Beneficiary, as Beneficiary may, from
time to time, reasonably consider necessary to create, perfect and preserve
Beneficiary's security interest hereunder. Grantor hereby irrevocably authorizes
Beneficiary to cause financing statements and any such documents, instruments
and assurances to be recorded and filed, at such times and places as may be
required or permitted by law to so create, perfect and preserve such security
interest. Grantor represents and warrants to Beneficiary that Grantor's
jurisdiction of organization is the State of [State of Grantor's organization].
After the date of this Deed of Trust, Grantor shall not change its name, type of
organization, organizational identification number (if any), jurisdiction of
organization or location without giving at least thirty (30) days' prior written
notice to Beneficiary.
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SECTION 7.3 FIXTURE FILING. This Deed of Trust shall also
constitute a "fixture filing" for the purposes of the UCC against all of the
Mortgaged Property which is or is to become fixtures. The information provided
in this Section 7.3 is provided so that this Deed of Trust shall comply with the
requirements of the UCC for a mortgage instrument to be filed as a financing
statement. Grantor is the "Debtor" and its name and mailing address are set
forth in the preamble of this Deed of Trust immediately preceding Article 1.
Beneficiary is the "Secured Party" and its name and mailing address from which
information concerning the security interest granted herein may be obtained are
also set forth in the preamble of this Deed of Trust immediately preceding
Article 1. A statement describing the portion of the Mortgaged Property
comprising the fixtures hereby secured is set forth in Section 1.1(d) of this
Deed of Trust. Grantor represents and warrants to Beneficiary that Grantor is
the record owner of the Mortgaged Property, the employer identification number
of Grantor is [_____________] and the organizational identification number of
Grantor is [__________].
ARTICLE 8
CONCERNING THE TRUSTEE
SECTION 8.1 CERTAIN RIGHTS. With the approval of Beneficiary,
Trustee shall have the right to select, employ and consult with counsel. Trustee
shall have the right to rely on any instrument, document or signature
authorizing or supporting any action taken or proposed to be taken by it
hereunder, believed by it in good faith to be genuine. Trustee shall be entitled
to reimbursement for actual, reasonable expenses incurred by it in the
performance of its duties and to reasonable compensation for Trustee's services
hereunder as shall be rendered. Grantor shall, from time to time, pay the
compensation due to Trustee hereunder and reimburse Trustee for, and indemnify,
defend and save Trustee harmless against, all liability and reasonable expenses
which may be incurred by it in the performance of its duties, including those
arising from joint, concurrent, or comparative negligence of Trustee; provided,
however, that Grantor shall not be liable under such indemnification to the
extent such liability or expenses result solely from Trustee's gross negligence
or willful misconduct. Grantor's obligations under this Section 8.1 shall not be
reduced or impaired by principles of comparative or contributory negligence.
SECTION 8.2 RETENTION OF MONEY. All moneys received by Trustee
shall, until used or applied as herein provided, be held in trust for the
purposes for which they were received, but need not be segregated in any manner
from any other moneys (except to the extent required by law), and Trustee shall
be under no liability for interest on any moneys received by Trustee hereunder.
SECTION 8.3 SUCCESSOR TRUSTEES. If Trustee or any successor
Trustee shall die, resign or become disqualified from acting in the execution of
this trust, or Beneficiary shall desire to appoint a substitute Trustee,
Beneficiary shall have full power to appoint one or more substitute Trustees
and, if preferred, several substitute Trustees in succession who shall succeed
to all the estates, rights, powers and duties of Trustee. Such appointment may
be executed by any authorized agent of Beneficiary and as so executed, such
appointment shall be conclusively presumed to be executed with authority, valid
and sufficient, without further proof of any action.
SECTION 8.4 PERFECTION OF APPOINTMENT. Should any deed,
conveyance or instrument of any nature be required from Grantor by any successor
Trustee to more fully and certainly vest in and confirm to such successor
Trustee such estates, rights, powers and duties, then, upon request by such
Trustee, all such deeds, conveyances and instruments shall be made, executed,
acknowledged and delivered and shall be caused to be recorded and/or filed by
Grantor.
SECTION 8.5 TRUSTEE LIABILITY. In no event or circumstance
shall Trustee or any substitute Trustee hereunder be personally liable under or
as a result of this Deed of Trust, either as a
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result of any action by Trustee (or any substitute Trustee) in the exercise of
the powers hereby granted or otherwise.
ARTICLE 9
MISCELLANEOUS
SECTION 9.1 NOTICES. Any notice required or permitted to be
given under this Deed of Trust shall be given in accordance with Section 8.02 of
the Contribution and Loan Agreement.
SECTION 9.2 COVENANTS RUNNING WITH THE LAND. All Obligations
contained in this Deed of Trust are intended by Grantor, Beneficiary and Trustee
to be, and shall be construed as, covenants running with the Mortgaged Property.
As used herein, "Grantor" shall refer to the party named in the first paragraph
of this Deed of Trust and to any subsequent owner of all or any portion of the
Mortgaged Property. All Persons who may have or acquire an interest in the
Mortgaged Property shall be deemed to have notice of, and be bound by, the terms
of the Contribution and Loan Agreement and the other Transaction Documents;
however, no such party shall be entitled to any rights thereunder without the
prior written consent of Beneficiary.
SECTION 9.3 ATTORNEY-IN-FACT. Grantor hereby irrevocably
appoints Beneficiary as its attorney-in-fact, which agency is coupled with an
interest and with full power of substitution, with full authority in the place
and stead of Grantor and in the name of Grantor or otherwise (a) to execute
and/or record any notices of completion, cessation of labor or any other notices
that Beneficiary deems appropriate to protect Beneficiary's interest, if Grantor
shall fail to do so within ten (10) days after written request by Beneficiary,
(b) upon the issuance of a deed pursuant to the foreclosure of this Deed of
Trust or the delivery of a deed in lieu of foreclosure, to execute all
instruments of assignment, conveyance or further assurance with respect to the
Leases, Rents, Tax Refunds, Proceeds, Insurance and Condemnation Awards in favor
of the grantee of any such deed and as may be necessary or desirable for such
purpose, (c) to prepare and file or record financing statements and continuation
statements, and to prepare, execute and file or record applications for
registration and like papers necessary to create, perfect or preserve
Beneficiary's security interests and rights in or to any of the Mortgaged
Property, and (d) after the occurrence and during the continuance of an Event of
Default, to perform any obligation of Grantor hereunder; provided, however, that
(1) Beneficiary shall not under any circumstances be obligated to perform any
obligation of Grantor; (2) any sums advanced by Beneficiary in such performance
shall be added to and included in the Indebtedness and shall bear interest at
the highest rate at which interest is then computed on any portion of the
Indebtedness; (3) Beneficiary as such attorney-in-fact shall only be accountable
for such funds as are actually received by Beneficiary; and (4) Beneficiary
shall not be liable to Grantor or any other person or entity for any failure to
take any action which it is empowered to take under this Section 9.3.
SECTION 9.4 SUCCESSORS AND ASSIGNS. This Deed of Trust shall
be binding upon and inure to the benefit of Beneficiary, Trustee and Grantor and
their respective successors and assigns. Grantor shall not, without the prior
written consent of Beneficiary (which consent shall not be unreasonably
withheld, conditioned or delayed), assign any rights, duties or obligations
hereunder except to a successor by merger or consolidation which assumes
Grantor's obligations hereunder. Subject to the consent of Borrower, Beneficiary
may assign or otherwise transfer all or any portion of its rights and
obligations under the Note or this Deed of Trust to any other Person, and such
other Person shall thereupon become vested with all of the rights and benefits
in respect thereof granted to Beneficiary under this Deed of Trust.
Notwithstanding the foregoing, Grantor acknowledges that Borrower has consented
to the transfer of Beneficiary's rights and obligations under the Note and this
Deed of Trust to Delphi Properties Holdings, LLC.
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SECTION 9.5 NO WAIVER. Any failure by Beneficiary or Trustee
to insist upon strict performance of any of the terms, provisions or conditions
of the Transaction Documents shall not be deemed to be a waiver of same, and
Beneficiary or Trustee shall have the right at any time to insist upon strict
performance of all of such terms, provisions and conditions.
SECTION 9.6 CONTRIBUTION AND LOAN AGREEMENT. If any conflict
or inconsistency exists between this Deed of Trust and the Contribution and Loan
Agreement, the Contribution and Loan Agreement shall govern.
SECTION 9.7 RELEASE OR RECONVEYANCE. Upon payment in full of
the Indebtedness and performance in full of the Obligations or upon a sale or
other disposition of the Mortgaged Property permitted by the Contribution and
Loan Agreement, Beneficiary, at Grantor's request and expense, shall release the
liens and security interests created by this Deed of Trust or reconvey the
Mortgaged Property to Grantor.
SECTION 9.8 WAIVER OF STAY, MORATORIUM AND SIMILAR RIGHTS.
Grantor agrees, to the full extent that it may lawfully do so, that it will not
at any time insist upon or plead or in any way take advantage of any stay,
marshalling of assets, extension, redemption or moratorium law now or hereafter
in force and effect so as to prevent or hinder the enforcement of the provisions
of this Deed of Trust or the Indebtedness or Obligations secured hereby, or any
agreement between Grantor and Beneficiary or any rights or remedies of Trustee
or Beneficiary.
SECTION 9.9 APPLICABLE LAW. The provisions of this Deed of
Trust regarding the creation, perfection and enforcement of the liens and
security interests herein granted shall be governed by and construed under the
laws of the state in which the Mortgaged Property is located. All other
provisions of this Deed of Trust shall be governed by the laws of the State of
New York (including, without limitation, Section 5-1401 of the General
Obligations Law of the State of New York).
SECTION 9.10 HEADINGS. The Article, Section and Subsection
titles hereof are inserted for convenience of reference only and shall in no way
alter, modify or define, or be used in construing, the text of such Articles,
Sections or Subsections.
SECTION 9.11 SEVERABILITY. If any provision of this Deed of
Trust shall be held by any court of competent jurisdiction to be unlawful, void
or unenforceable for any reason, such provision shall be deemed severable from
and shall in no way effect the enforceability and validity of the remaining
provisions of this Deed of Trust.
SECTION 9.12 GRANTING OF EASEMENTS. Provided that no Event of
Default shall have occurred and be continuing or shall result therefrom,
Beneficiary hereby consents in each instance to the following actions by
Grantor, in the name and stead of Beneficiary and as the true and lawful
attorney-in-fact of Beneficiary (which appointment is coupled with an interest)
with full power and authority to execute and deliver documents on behalf of
Beneficiary for the following purposes, but at Grantor's sole cost and expense:
(i) the granting, entering into, amendment and modification, of easements,
licenses, rights of way, building and use restrictions and similar agreements
affecting the Mortgaged Property; (ii) the release or termination of existing
easements, rights of way, building and use restrictions and similar agreements
affecting the Mortgaged Property; (iii) the seeking of any zoning variances or
modifications to existing zoning; (iv) the application for, and obtaining of,
any permits or approvals from any Governmental Authorities which pertain to the
Mortgaged Property (and the execution and delivery of any agreements or other
instruments which are necessary or desirable in connection therewith); and (v)
the dedication or transfer of portions of the Mortgaged Property for road,
highway or other public purposes; provided, however, that in each case the
easement, building and use restriction, other
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agreement, amendment, modification, termination, release, application,
dedication or transfer shall be on commercially reasonable terms and shall be of
such a nature to qualify as a Permitted Lien. Without limiting the effectiveness
of the foregoing, and provided that no Event of Default shall have occurred and
be continuing or shall result therefrom, Beneficiary shall, upon the request of
Grantor, and at Grantor's sole cost and expense, execute and deliver any
instruments necessary or appropriate to confirm any such grant, release,
dedication, transfer, annexation or amendment.
SECTION 9.13 ENTIRE AGREEMENT. This Deed of Trust and the
other Transaction Documents embody the entire agreement and understanding
between Grantor and Beneficiary relating to the subject matter hereof and
thereof and supersede all prior agreements and understandings between such
parties relating to the subject matter hereof and thereof. Accordingly, the
Transaction Documents may not be contradicted by evidence of prior,
contemporaneous or subsequent oral agreements of the parties. There are no
unwritten oral agreements between the parties.
ARTICLE 10
LOCAL LAW PROVISIONS
[TO COME]
[THE REMAINDER OF THIS PAGE HAS BEEN INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, Grantor has on the date set forth in the
acknowledgement hereto, effective as of the date first above written, caused
this instrument to be duly EXECUTED AND DELIVERED by authority duly given.
[GRANTOR],
a [State of organization and entity type]
By: __________________________
Name:
Title:
S-1
STATE OF ______________ )
) ss.
COUNTY OF _____________ )
On the ___ day of __________, 2003, before me personally appeared
________________________, personally known to me (or proved to me on the basis
of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to
the within instrument and acknowledged to me that he/she/they executed the same
in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s) or the entity upon behalf of which
the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
[SEAL]
___________________________
Notary Public
My commission expires:
_________________________________________
S-1
EXHIBIT A
Legal Description of premises located at [Address of Premises]:
[SEE ATTACHED PAGE(S) FOR LEGAL DESCRIPTION]
Exh.A-1